Losses widen at Pochin’s
CHESHIRE construction group Pochin’s saw losses widen in the year to May, reflecting the tough environment in the sector and lower property values.
During the period the Middlewich-based company reported a pre-tax loss of £6.7m, down from £1.1m, on revenues of £77.9m, up from £71.6m.
According to the firm the UK suffered an 8% fall in new non-housing work in 2012, and the decline was steeper in the North West, and its commercial property portfolio was hit by declining values. Some £6.7m was wiped from the value of its property holdings following a revaluation.
This led to the group breaching a banking covenant with the Royal Bank of Scotland which stipulated that Pochin’s net assets should not fall below £19m at any time. Since the year end RBS has agreed to revise down the asset test to £12m.
Nonetheless, Pochin’s said its construction division has performed “creditably”, increasing turnover from £68.4m to £73.7m. Contracts for work outside the region contributed significantly as the division sought to mitigate lower local activity, although this reduced margins.
Pochin’s, which employs 158 people, is also encouraged by its Cheshire Fresh idea, a £50m space dedicated to the farming and food industry at its Midpoint 18 business park in Middlewich.
Chairman Richard Fildes said: “In recent years the group has endured unrelentingly tough conditions in its markets, with consequential painful outcomes for both employees and shareholders. Though considerably reduced in size, having taken radical measures to extract itself from loss making activities and damaging joint ventures, the group is now in a position to take advantage of the improved sentiment which is emerging in its remaining areas of activity.”
