Housebuilder Galliford Try has been forced to set aside around £98m to complete two major infrastructure projects.
In a trading update for the period between 1 January to 2 May 2017, the group said it had re-appraised costs to complete two large-scale projects since its half year results on 21 February.
It said: “A re-appraisal of costs to complete two major infrastructure joint venture projects has substantially increased the anticipated liability to conclude the legacy contracts (contracted in 2014 and earlier) in the group’s construction business since Galliford Try reported its half-year results on 21 February 2017.”
The group has set aside £98m to cover these costs. Some 80% of this amount is accounted for by the problem jobs.
Galliford Try said that despite this, the underlying construction business continued to perform well.
Chief executive Peter Truscott said: “The impact of the legacy projects in construction, in particular the two large infrastructure projects, is regrettable.
“However, as described in our recent strategy presentation, Galliford Try is no longer undertaking large infrastructure jobs on fixed price contracts. There are no other similarly procured major projects in our current portfolio and we are encouraged by the performance of the underlying portfolio of newer work.”
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