Profits plunge at NMC
Pre-tax profits have reduced by more than 35 per cent to £1.3m at Nottinghamshire building specialist North Midland Construction (NMC).
The company blamed the 35.6 per cent drop in pre-tax profit on its building subsidiary's "significant losses".
Revenue increased by 17.2 per cent to £91.3m in NMC's latest six-month results.
North Midland Building made a loss of £1.9m on revenue of £11m for the half-year to 30 June 2011.
NMC said the division's poor performance was due to a major contract which was currently "seriously delayed and will result in a claim for losses incurred".
The company added that unforeseen operational problems on two other projects resulted in losses of £910,000. Predicted outturn losses on these three contracts were incorporated into the half-year result.
A reorganisation of the building division is currently underway which will result in significant overhead reduction, said NMC.
Nomenca, NMC’s mechanical & electrical subsidiary, reported a 63.0 per cent rise in revenue to £29.3m.
Robert Moyle, chairman of NMC, said: "With the exception of the building subsidiary, the remains of the group continues to trade profitably, despite the difficult economic conditions and it is all credit to our staff who play a vital part in this success.
"NMB is facing the biggest challenge though, but we are confident that once the re-organisation has taken place the business will move forward."
