Galliford Try is now a smaller, cash-rich pure contracting company, with the slate wiped clean.
For the year ending 30th June 2020, Galliford Try generated revenue of £1,122m from continuing operations (i.e. excluding the six months contribution from the house-building operations now sold). This is 20% down on the previous year’s £1,400m and puts Galliford Try outside of the Top 10 of UK contractors for the first time in many a year.
It made an overall pre-tax loss for the year of £34.6m. This was not as bad as the previous year’s pre-tax loss of £64.5m, but would almost have been but, for a happy injection of £28.0m from the Scottish government in final settlement of the Aberdeen Western Peripheral Route (AWPR) saga.
Excluding exceptional items, the numbers look much worse: a £59.7m pre-tax loss this time compared to a £17.2m loss (pre-exceptionals) in financial 2019.
The building division incurred a net loss from operations of £53.9m (2019: £10.4m profit) and infrastructure made a profit of £25.5m (2019: £51.0m loss). These performances were adversely impacted by Covid-19 and associated project delays, contract settlements and legal costs, the board said.
Galliford Try ended the financial year with a well-capitalised debt-free balance sheet, with cash of £197m, a PPP portfolio of £41m and no defined pension scheme liabilities to fund. Average month-end net cash, for the six months since the disposal of housebuilding, was £141m.
It has an order book of £2,152m for the building division and £1,010m for infrastructure.
Chief executive Bill Hocking said: “This year has been a period of significant change for the group. We have successfully transitioned to a well-capitalised UK construction business and I am confident about our future.
“The group responded rapidly and effectively to the challenge of the Covid-19 pandemic and I have been particularly impressed by, and thankful for, the outstanding efforts of our staff throughout this period. All of our construction sites are now operational, and productivity is close to normal levels. Working with all stakeholders we will continue to maintain the highest safety, wellbeing and Covid-19 secure practices throughout all aspects of our operations.”
He added: “The group is performing well and focusing on its core strengths of building, highways and environment. In recent months we have secured a number of significant project wins and we are well placed to benefit from planned future investment in our areas of operation.”
The annual results statement also reveals that Galliford Try is in a legal battle for £95m from a former client. “As previously disclosed, the group provided services in respect of three contracts with entities owned by a major infrastructure fund of a blue-chip listed company. Our work on these contracts formally ceased on their termination in August 2018. Costs were significantly impacted by client-driven scope changes and the group has submitted claims and variations to the value of £95m in respect of these costs (2019: £54m). The group has taken extensive legal advice on our entitlement and we have been successful in two adjudications supporting the validity of the group’s position.”