Return to profit for Shepherd
SHEPHERD Group has returned to profits, making £16m before tax despite taking a significant cut in revenue.
The company made a £1.5m loss last year although that included an exceptional £12.4m cost suffered by Shepherd Construction in connection with the problems surrounding the Trinity Walk development in Wakefield.
Turnover for the year to the end of June fell by almost a quarter to £526.7m although operating profit before exceptional items fell by just £1m to £23.6m.
Group chairman Alan Fletcher said: “The economic background to our operations continues to present a stern challenge for the group’s management. That management has risen strongly to the challenge, as reflected in the group’s annual results.
“The group’s performance shows the benefits of the actions taken to secure cost efficiencies. The resilience of the group in the face of the ongoing economic challenge is shown in the strength of its cash generation. Good cash management is of paramount importance in protecting the interests of the group, particularly in time of economic difficulty.
“We must be cautious about short to medium term prospects at this uncertain point in the recovery from the worst global recession in living memory. However, the actions taken, and the advantageously restructured banking facility which we enjoy, enable us to exploit fully opportunities arising now and in the future.”
Shepherd’s industrial division recorded pre-tax profits of £24m, down by £3.1m as the Portakabin operation was hit by a near 14% reduction in turnover.
Turnover also fell in the built environment division, by 43%, contributing to an operating loss of £2.1m while the SES business recorded a pre-tax profit of £2.5m as tunrover fell 14%.
In sharp contrast, the property division capitalised on increased activity to increase turnover to £38.6m as it cut losses from £17.4m to £6.4m.
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