{"id":482490,"date":"2023-07-12T15:48:18","date_gmt":"2023-07-12T14:48:18","guid":{"rendered":"https:\/\/www.constructionnews.co.uk\/?p=482490"},"modified":"2023-07-12T15:48:18","modified_gmt":"2023-07-12T14:48:18","slug":"profit-slumps-at-willmott-dixon-in-wake-of-supply-chain-failures","status":"publish","type":"post","link":"https:\/\/www.constructionnews.co.uk\/contractors\/willmott-dixon\/profit-slumps-at-willmott-dixon-in-wake-of-supply-chain-failures-12-07-2023\/","title":{"rendered":"Profit slumps at Willmott Dixon in wake of supply chain failures"},"content":{"rendered":"

Pre-tax profit plummeted at Willmott Dixon last year, with the firm blaming difficult trading conditions and spiralling supply chain insolvencies for a \u201cdisappointing\u201d set of annual results.<\/p>\n

Profit before tax, amortisation of goodwill and exceptional items was \u00a310.9m, down from \u00a341.2m the year before, according to the group\u2019s accounts for the year ending 31 December 2022.<\/p>\n

And taking into account goodwill amortisation of \u00a32.4m and a \u00a37.5m provision for what the firm described as \u201cexpected but not yet virtually certain\u201d insurance recoveries, pre-tax profit slumped further from \u00a328m in 2021 to \u00a31m.<\/p>\n

Willmott Dixon is taking legal action\u00a0against subcontractors and consultants<\/a> over defective cladding on a residential building in Woolwich following an agreement with owners Tesco to carry out remedial work.<\/p>\n

However, in audited accounts filed with Companies House, the firm stated that turnover had held up better than might have been expected given challenging recent conditions, growing by 3.9 per cent to reach \u00a31.15bn.<\/p>\n

The rapid and sustained surge in inflation had a particular impact on results, it said, with more than \u00a3100m of potential new orders postponed or cancelled during the latter part of last year.<\/p>\n

Group chairman Colin Enticknap said: \u201cCustomers found they could no longer meet their own viability targets, and on projects already secured at pre-inflation prices, our supply chain partners really struggled to accommodate \u2013 and in some cases survive \u2013 the sheer scale of unpredicted cost increases they faced.<\/p>\n

\u201cWhere supply chain failures did occur, progress on sites was severely hampered and sourcing replacements came at a substantial cost premium.\u201d<\/p>\n

Willmott Dixon\u2019s order book remained \u201csurprisingly resilient\u201d despite postponed and cancelled orders, Enticknap added.<\/p>\n

A recent reorganisation that saw two of its construction divisions merge into a renamed South operation, the integration of business support services and a recruitment freeze in most areas were expected to translate into a \u00a320m reduction in annualised costs, improving resilience until market conditions picked up, he added.<\/p>\n

Having taken steps to balance costs against the lower end of turnover expectations for 2024, the firm was well-positioned to deliver improved performance over the year ahead, Enticknap said.<\/p>\n","protected":false},"excerpt":{"rendered":"

Pre-tax profit plummeted at Willmott Dixon last year, with the firm blaming difficult trading conditions and spiralling supply chain insolvencies for a \u201cdisappointing\u201d set of annual results. Profit before tax, amortisation of goodwill and exceptional items was \u00a310.9m, down from \u00a341.2m the year before, according to the group\u2019s accounts for the year ending 31 December …<\/p>\n","protected":false},"author":130832,"featured_media":482523,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ep_exclude_from_search":false,"footnotes":""},"categories":[552,546],"tags":[],"class_list":["post-482490","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-financial","category-willmott-dixon"],"yoast_head":"\nProfit slumps at Willmott Dixon in wake of supply chain failures | Construction News<\/title>\n<meta name=\"description\" content=\"Pre-tax profit plummeted at Willmott Dixon last year, with the firm blaming difficult trading conditions and spiralling supply chain insolvencies for a\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, 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