Firm says its UK building and FM arms each racked up £30m-plus losses last year
Losses on fixed price contracts at its building arm as well as a problem PFI contract for its facilities management division sent Vinci’s UK business crashing into the red last year.
In accounts filed at Companies House, the UK arm of the French contracting and airports giant sank to a £44m pre-tax loss from a near £24m profit last time.
The firm’s building business was hit by two problem jobs which it said were “long term fixed price contracts both of which were entered into pre the covid pandemic”.
Vinci said the jobs, believed to be a student accommodation scheme for UCL at Stratford in east London and a specialist hospital scheme in Birmingham for a local NHS trust and HCA Healthcare, both of which were agreed in spring 2019, sent the building division tumbling to a £37.3m pre-tax loss last year from an £11.7m profit last time.
The UCL scheme was finished last summer and Vinci said in the accounts, signed off last month, that the HCA job was due to finish over the summer.
It added: “Our entire building business also suffered from hyperinflation, labour shortages and a higher than usual attrition rate.”
And it said a “challenging” PFI contract with the Coventry and Rugby Hospital Company for the firm’s FM arm sent that business to a £32m pre-tax loss last year from an £11m profit last time.
The divisions were the firm’s biggest in terms of revenue last year with building seeing income rise 14% to £551.5m while its FM business saw turnover up 22% to £444m.
The losses took the shine off an improved performance from its Taylor Woodrow civil engineering business which saw pre-tax profit jump 26% to £10.8m on revenue down 8% to £292m.
Vinci said TayWood, which is carrying out work on the HS2 schemes at Old Oak Common station and tunnelling works in the Midlands at Long Itchington Wood, said it was targeting more work on HS2 along with jobs in London and the energy sector.
It added that it was still optimistic about the UK infrastructure market despite the recent decision to cancel the leg of HS2 to Manchester with the government preferring a “range of smaller rail projects which are well suited to the skills of Taylor Woodrow”.
Overall, group revenue was up 10% to £1.3bn but the firm racked up a pre-tax loss of £44m from a £23.6m profit in 2021. It said its cash balance was £148m last year, down £40m from 2021’s number.
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