Problem contracts push losses up again at nmcn to £24m

Grant Prior 4 years ago
Share

Listed civils contractor nmcn has announced a fourth increase in predicted losses to the stock market this time to £24m.

The latest trading update this morning also warned that “the company will need to consider all appropriate options” if ongoing refinancing talks fail.

Losses for 2020 were predicted at £15m last October then £16.5m in December and £22m in February.

The update said: “Activity levels across the business are reasonable however we are dealing with some performance issues in our Building business unit and are still experiencing a number of challenges on two loss making contracts in Water which will impact current year performance.”

New CEO Lee Marks is conducting a comprehensive review of the business and Preliminary Results for last year will be published by the end of June.

Nmcn secured an initial round of refinancing last month worth £21.2m.

It is still in talks with under lenders about a larger deal – which the Enquirer understands is worth around £50m.

Nmcn said: “The Company has been working since Q4 2020 to secure a financing package more appropriate to the size and nature of the Group’s businesses and risk profile.

“This has been a core focus of the Board in light of a number of contractual issues exacerbated by the Covid-19 pandemic which have resulted in the Group now expecting to report overall underlying losses before tax of £24m, approximately £6m of which are attributed to 2019.

“These issues have presented significant challenges requiring the Board to actively manage the Group’s working capital whilst work on the refinancing has been undertaken.

The Company is pleased to report that discussions are progressing well with a number of interested parties.

“The Board has now received heads of terms and is working towards concluding an agreement during June.

“If the Group is unable to secure commitment for the requisite level of funding to satisfy its ongoing working capital requirements, then the Company will need to consider all appropriate options.

“The Company’s overdraft facility with Lloyds Bank plc has been extended into June to accommodate the continuation of these discussions.”

Marks said: “I was delighted to join the Company as Chief Executive earlier this month, as I see a business with a significant depth of expertise focusing on attractive and appropriate addressable markets.

“The combination of internal issues and the Covid-19 pandemic has undoubtedly created very challenging circumstances for nmcn over the course of the last 18 months and I would like to thank my colleagues for their efforts.

“There is certainly much to do but with progress toward an appropriate financing structure being made I look forward to the challenge.”

Nmcn’s share price fell more than 20% in early trading on Friday morning.

Latest news

Kier wins first phase of £700m Warwick Uni campus build

Firm to start work on science and engineering precinct last this year
9 hours ago

Torsion and Khalbros to build new Leeds £1bn neighbourhood

Eastgate Quarter site acquired from Hammerson
9 hours ago

JCB to double size of US factory in wake of Trump tariffs

$500m Texas factory under construction to expand to 1m sq ft
10 hours ago

Green light for £2.4bn Luton Airport expansion

Government go-ahead to transform airport
10 hours ago

Diversification pays off for concrete frame specialist Statom

Strong results as £180m turnover firm expands into infrastructure sector
12 hours ago

Cardo in talks to buy Breyer roofing arm

More than 100 jobs could be saved at Breyer Roofing
17 hours ago

Quartet win £750m Wales & Western railway deal

Network Rail confirms partners for Reactive and Minor Works framework
17 hours ago

Plans in for £350m London Bridge life sciences hub

Snowsfields Quarter will consist of three buildings containing labs
18 hours ago

Surging labour costs push tender price forecast up

Pick-up in tender prices despite weak growth
18 hours ago

Permasteelisa wins cladding deal on Multiplex city tower

Facade specialist wins work on Fenchurch Street ‘hanging gardens’ tower
17 hours ago

Wates wins fit-out for Manchester First Street Hub

Smartspace arm secures another Government hub deal
2 days ago

Peel Ports reveals winners for £750m framework

18 firms win places on deal: Full list
2 days ago

Big trade names dropped in M Group rebrand

Acquisitive group formed from Morrison Utility services in 2016
2 days ago

Breyer Group files administration notice

Staff hope rival firm could buy assets and save jobs
2 days ago

Former Severfield director takes helm at Embrace Steel

New CEO Martin Kelly aims to step up expansion of steelwork contractor
2 days ago

£302m upgrade funding awarded to FE colleges – list

Cash shared out between England’s 179 college groups
2 days ago

FK Facades thrives but construction arm hit by ISG row

Dispute with failed contractor costs specialist £5.5m
2 days ago

Galliford Try gets go-ahead for Milton Keynes PRS tower

33-storey tower needs gateway 2 approval before work can start
2 days ago

Small house builders get £150m funding for green homes

Developers will have to meet-up to ten new criteria to benefit from interest rate discounts
2 days ago

Lendlease Construction renamed Bovis

US private equity firm completes £35m purchase of UK contracting business and rebrands
3 days ago

Breyer Group battles for survival as rivals circle

Housing maintenance firm fights three winding up petitions in a month
3 days ago

Careys facing £2.4m claim by developer over demolition cartel

Giant Hong Kong developer claims it was overcharged on Lots Road Power Station job
3 days ago

Multiplex profit drops a third as revenue rises to £780m

Spate of new orders sets contractor up for three years of work
3 days ago

Galliford Try and Breheny land latest Sizewell C road deals

More infrastructure deals for new nuclear power station
3 days ago

Worker trapped in collapsed septic tank pit

Contractor and director fined after worker suffers multiple fractures
3 days ago

Homes England buys stalled Broad Marsh site

Demolition to finally be completed as developer hunt begins
3 days ago

Vistry go-ahead for 353 homes at Rochester Riverside

Work to start on next phase of Kent town regeneration at end of this year
4 days ago

M&E firm J S Wright collapsed owing £19m

Trade creditors hit for £11.4m by employee-owned Midlands firm
4 days ago

Right to work checks to be extended to self-employed

Government plans crackdown on illegal working and rogue employers
4 days ago

Midlands developer turns to London with £1bn resi schemes trio

SevenCapital plans 1,000 flats in Kensington, Islington and the Isle of Dogs projects
4 days ago

Contractor services