Robertson Group reveals extent of Covid damage
Robertson Group said today it has returned to “normal trading expectations” after revealing a £6.7m operating loss last year due to the coronavirus pandemic.
The family-owned contractor extended its financial year to 15 months to the end of June 2020 to absorb the three-month closure of the majority of its 100 construction sites in March of last year.
But accounts now filed with Companies House has shown that a Covid-related hit of £11.5 million saw pre-tax profits fall to £1.2m during the 15 months to June, compared to a profit of £21.5m in the previous 12 months. Turnover of £637.2m was also lower than the previous year’s £713.4m.
Chairman Bill Robertson said that with the first lockdown starting two weeks before what would have been the end of the regular reporting period, the extension also gave directors time to assess the financial impact of Covid-19 on the business.
“This has proven to be a successful strategy as we made a strong recovery [in the current financial year] and are now operating close to our normal trading expectations,” he said.
“The group enjoyed a positive year. However, profits generated in the 12 months to March 20 were all but eradicated in the quarter to June 2020 as we accounted for closed sites in Scotland and a significant reduction in productivity at our English-based operations in the period.”
Robertson Group did not take any government-backed Covid emergency loans, but it did make use of the coronavirus job retention scheme. During the period from April to mid-June, approximately one-third of its employees were on furlough, with a gradual return to work through June and July.
The majority of construction sites closed in March of last year, except for some key sites in Scotland and those in England. The timber engineering facility was also forced to close during the first lockdown, and while the facilities management business continued to operate from the majority of its 80 sites, this was on a reduced basis and in some cases adapted to provide a different service to clients.
All sites are now operational, with productivity returning to pre-covid levels as businesses adapt to health-related operating restrictions. Where possible, working from home continues to be the default position.
“Like so many other companies we have had to quickly adapt to more flexible ways of working,” directors said in their strategic review. “We continue to assess the positives from this period to ensure we find a working environment going forward which best fits the business and our staff.”
Gross margins for the 15-month period fell from 8.4% to 7.2%, with the previous operating profit margin of 2.4% reduced to a loss-making margin of 0.9%.
No dividends were paid during the period under review, though directors’ collective remuneration – including contributions to money purchase schemes – rose from £3.7m to £4.7m, in line with the extension to the financial year. Total emoluments of the highest paid director were £1.48m, down from £1.57m.
Following an extensive review of all operations during the lockdown period, the group has implemented changes to safe working practices across all areas of the business. These are reviewed regularly as circumstances and government guidance change over time.
Mr Robertson said the group is now well-placed to deal with the challenges presented by Covid-19.
“With the health, safety and wellbeing of our employees, customers, supply chain and the communities where we work our number one priority, we have worked to stringent Covid-safe operating procedures and are pleased to have weathered this period of uncertainty,” he added.
“We look ahead with confidence as we continue with our long-term strategy to deliver sustainable and quality profit growth.”