Morgan Sindall still expects positive results this year despite two written-off legacy contracts dragging the firm into a pre-tax loss of £14.8 million, it has been revealed.

The two old construction deals were inherited as part of an acquisition of Amec in 2007.

The anticipated final cost of the contracts was expected to rise close to £47m.

However, by cancelling the deals, the group has generated a tax credit of £4.8m for 2016.

Overall, group revenue rose 7% to £2,385m from £2,220m compared to 2014, with strong performances in both its Fit-Out and Urban Regeneration businesses.


Affordable Housing also grew 43%, driven by reduced losses in the response maintenance activities.

John Morgan, Group Chief Executive, said: "We are pleased with the year end result which is evidence of the strategic and operational progress made across the Group during the year and this, together with a positive outlook going into 2016, has enabled us to raise the final dividend.

"Fit Out has performed very strongly, with record revenue levels coupled with significant margin growth, whilst Urban Regeneration has again delivered a strong profit performance thereby reinforcing our long-term strategic investment in our regeneration activities.

"Margins in Construction & Infrastructure have remained low as expected, however the second half of the year has seen an improvement in its performance as a result of the considerable progress made in closing out its older and lower margin construction contracts in London and the South, and which then puts the division on a stronger footing going forward.

"Looking ahead to 2016, the positive momentum across the Group is expected to continue."

(LM/MH)