EXCEPTIONAL COSTS from the flotation of access equipment subsidiary SGB and the closure of German contractor Bautec masked a strong underlying performance from Mowlem in 1997, according to results published last week.
Losses following the 49% flotation of SGB amounted to 34.5M. Closing Bautec cost another 2.7M.
These costs resulted in group pre-tax losses of 11.5M last year compared with a pre-tax profit of 16.7M in 1996. Turnover was static at 1.4bn. But after stripping out the exceptional items pretax profits showed an increase to 31.3M.
Operating profits from the construction division rose sharply to 9.1M from 3.4M in 1996, despite a slight fall in turnover from 971M to 967M. Chief executive John Gaines said the improvement was due to a more realistic approach to pricing by competitors and clients.
Mowlem was only able to sell the loss-making Bautec last December. The former state-owned firm was sold to Mowlem just after the Berlin Wall came down, but under an agreement with the German government Mowlem had to maintain employment levels until the end of 1997.