Severfield is shutting its modular trade as a part of a promised assessment into the operations of the rustic’s greatest steelwork contractor by way of its new leader govt.
Paul McNerney arrived on the company from Laing O’Rourke closing November and instantly defined a assessment of the corporate which has not too long ago been hit by way of a sequence of losses.
In an replace this afternoon, Severfield stated it was once remaining the Modular Answers arm which in its closing monetary 12 months had a turnover of £24.2m and made a pre-tax benefit of £333,000. The trade provides metal frames for modular construction producers and are used essentially within the industrial, healthcare, schooling and lodging sectors.
In a remark, Severfield stated: “As a part of this assessment, the Board has concluded that the Modular Answers trade represents a sub-scale, non-core task of the Staff, and following attention of the strategic choices to be had, has taken the verdict to discontinue the trade.”
It stated it anticipated some process losses to be made however declined to mention what number of people can be affected. It added: “The Staff is operating constructively with all stakeholders suffering from this determination and can search to restrict the have an effect on on workers inside that trade, together with via suitable session, redeployment and give a boost to processes.”
Consistent with its closing set of accounts for the 12 months to 29 March 2025, the trade, which was once because of transfer to a brand new house in Malton, North Yorkshire, hired 143 other people.
McNerney stated: “After I joined Severfield, I used to be transparent that my priorities have been to redefine our technique, improve our production and supply features, power higher potency, and give a boost to our center of attention on engineering excellence for our shoppers. The verdict introduced as of late follows cautious attention and is meant to give a boost to the long-term energy and sustainability of the Staff.
“This marks crucial early step in reshaping our technique and we can supply a broader replace at the expansion technique for our core companies right through 2026.”
Severfield, which has been sporting out metal paintings on British Land’s 2 Finsbury Street within the Town of London being constructed by way of Sir Robert McAlpine, stated its center of attention remained on its core structural steelwork actions the place its order ebook in the beginning of this month stood at £479m.
It added that its Building Steel Forming trade was once no longer suffering from as of late’s announcement and can proceed to perform as a separate three way partnership of the corporate.
In its most up-to-date set of effects, for the six months to 27 September closing 12 months, Severfield noticed earnings fall 18% to £206m with pre-tax losses rising from £5.8m to £7.6m – a upward thrust of 31%. Underlying benefit for the length nosedived from £16m to only £600,000, a fall of 96%.
Severfield has not too long ago been hobbled by way of the invoice for sporting out upkeep on a number of bridges, the vast majority of that are at the HS2 railway.
Final July, the company stated it estimated the price of finding out the issues, which centre on welding defects, can be £43.4m even though insurance coverage recoveries of £20m will carry the hit right down to £23.4m.
