Office fitter reports order reduction
Havelock takes hit from client cut
Shop and office fitter Havelock Europa suffered a further setback after it biggest financial services client said it is cutting back on refurbishment next year.
Havelock will be retained as the preferred furniture provider to the client, believed to be Lloyds Banking Group.
The Fife firm said contracting revenues from the client for 2015 will be about £14m and will be unaffected by the new arrangements which will take effect from 1 January 2016.
This means there will be little financial impact on 2015 results, but the impact on 2016 will be material “before mitigating actions are undertaken”.
On his appointment as chief executive in May, David Ritchie initiated a review of the Havelock Europa business which led to plans for about 50 job losses, mainly at its Kirkcaldy headquarters.
He also announced plans to diversify its customer base, and a streamlining and simplification of the business model.
It later announced a loss before tax is down from £1.9 million to £1.8m which was achieved on turnover which fell from £30.5m to £28.9m. It said this reflected subdued demand in the retail and financial services sectors.
In a statement this morning, he said: “Today’s news is disappointing, clearly, but underlines the importance of our strategy to further diversify our customer base to become less reliant on a small number of contracts. The simplified business model we are implementing will also help us maximise the customer experience across that broader portfolio of clients. We are committed to delivering that change and thus mitigating the impact of this decision in 2016 and beyond.”