NG Bailey takes £2.2m hit from Carillion contracts

Carillion was building the Midland Metropolitan Hospital

Yorkshire headquartered building services firm NG Bailey has revealed it took a £2.2m hit when its contract on the Midland Metropolitan Hospital stalled following the collapse of construction giant Carillion.

In its accounts for the year to March, the Ikley-based contractor said it had recognised a £2.2m exceptional loss for irrecoverable contract costs.

The group had been managing the MEP design and installation at the hospital, worth £80m, when project work was halted in January when Carillion folded.

The group also incurred exceptional restructuring costs of £2.1m, relating mainly to its IT services division.

However, NG Bailey reported pre-tax profit touching £20m for the period, up from £18.6m the year before.

Including exceptional costs, turnover sipped slightly to £481m from £500m, which it said reflects the current economic challenges in its markets and a small number of cancelled projects.

Looking ahead, NG Bailey said it is making “substantial progress” in transforming the shape of the business to deliver long term value to shareholders, evidenced by a strong order book of £1bn at period end.

Since the year-end NG Bailey acquired Freedom Group, a provider of facilities and power engineering services.

The company said: “The acquisition builds on our long-term strategy of sustainable growth and increasing our capabilities in sectors such as defence and airports, as well as expanding our engineering and maintenance services across major infrastructure portfolios such as data centre telecoms and ports.”

The addition of Freedom’s 600-strong team will take NG Bailey’s group headcount to more than 3,000 staff.

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