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Galliford Try annual profit shrinks as construction unit falters

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By Reuters

(Reuters) – British builder Galliford Try Plc <GFRD.L> posted a 27% drop in pretax profit that missed expectations on Wednesday as its construction business took a hit from contract write-downs and restructuring costs amid a slowing UK housing market.

“Construction’s result for the year has been impacted by challenges with both legacy and some current projects and by the restructure, which is now complete,” the company, which has been reducing its exposure to the construction industry, said.

It has also restarted talks to sell its residential housing units to Bovis Homes <BVS.L> after Bovis nudged up its proposed offer to 1.08 billion pounds.

The FTSE 250 company’s pretax profit fell to 104.7 million pounds from 143.7 million pounds a year earlier.

This was well below the forecast of between 112.7 million pounds to 116.4 million pounds, according to company-compiled analyst estimates as of July 16.

Its operating losses in construction business more than doubled to 61.5 million pounds, while total order book fell to 2.9 billion pounds from 3.3 billion pounds last year.

Exceptional items in the year were 50.8 million pounds. More than half of the amount was due to additional costs to complete the Aberdeen Western Peripheral Route contract.

(Reporting by Yadarisa Shabong in Bengaluru; editing by Arun Koyyur)