Muir positioned for growth after bad debt dents profits
John Muir: ‘ We are well positioned’
Fife-based contractor, housebuilder and property developer, Muir Group, reported group profit before tax fell to £2.55m from £3.26m in the previous 12 months because of bad debt in the contracting business.
Despite the current uncertainty in the economic climate, turnover came in flat at £65.07m against £65,375,000 last time. Key growth areas have been private housing, property development and timber kit manufacture.
Housing turnover rose around 10% by just under £3m to £32m (2018: £29.5m. Customer satisfaction and build quality continue to improve. Average house prices were £206,000 (2018: £194,000), and the number of house sales continues to increase to 157 homes this year (2018: 152 homes).
Muir Contracting showed a loss for the year due to a potential bad debt. A provision of the full outstanding debt of £1.6m has been made, however the debtor is undergoing refinancing. This meant contracting showed a loss of £523,000 compared to £818,000 profit last year.
There was also a one-off charge for pensions equalisation.
The company said the current year is already looking positive, with a robust pipeline of activity underway. Muir is working with prospective tenants for turnkey developments at Glasgow Business Park.
Additionally a 10,000 square foot office has already been let at Aberdeen Gateway to Wellsafe. A retail development at Dalgety Bay has been completed and the lease for the final unit is being concluded. Construction work is underway after Muir was successfully chosen to provide a 74,500 square foot warehouse and blend facility in East Kilbride for multinational brewing and beverage company Distell International.
Commenting on the results, John Muir, chairman, said: “This is a positive set of results given the challenging environment the construction industry is facing. Looking forward, the Group is well positioned, with a strong debt free balance sheet and returns are expected to show a significant improvement in the current financial year.”