Uncertainty over future of Rotary’s parent
THE Australian parent company of Rotary, the mechanical and engineering contractor, which worked on MediaCityUK and is also involved in the Co-operative Group’s new HQ, has been plunged into uncertainty.
Hastie Group, which owns Warrington-based Rotary, and has bases around the country, including Yorkshire and the West Midlands, has asked for trading in its shares to be halted, pending an an announcement about one of its Middle Eastern joint ventures.
The group, which has 4,000 staff worldwide, designs, installs and maintains technical services for the building and infrastructure sectors, including mechanical services, electrics, hydraulics and refrigeration.
Its shares have nose-dived in the last year and last traded at Aus 16 cents, but were priced at around $2 Aus 12 months ago. In February it posted a Aus $149m loss for the six months to the end of December 2011, and revealed that writedowns to its troubled Middle Eastern operations had triggered breaches of several borrowing covenants.
The group’s own auditors have also flagged-up the material uncertainty regarding its ability to continue as a going concern.
Most recently-filed accounts for Rotary North West, for the year to the end of June 2011, reveal a fall in turnover and profits, but a hike in the dividend paid to the parent company from £500,000 to £4m in the period.
Turnover fell from £47.7m to £27.9m, while profits were down to £2.7m from £4.1m in 2010.
In its 2011 annual report Hastie said the UK market continued to suffer from a lack of private and government investment. It said revenue had fallen as a result of “the delay and postponement of secured projects.”
It added: “Despite the current market conditions, Rotary is well positioned to compete against its peers and has 75% secured against budget for FY2012.
“This includes the successful award of flagship projects including Leeds Arena, the Co-operative headquarters and Bangor Pool.”
