Infrastructure services group Mouchel sees revenue remain steady at £270m but pre-tax loss has soared to £11.6m, according to the half-year financial results up to January 2012.
On the back of the results the group has announced an £18m cut in costs, the majority of which will be made by September 2012.
The company is also considering a “significantly dilutive equity raise” in order to raise more funds.
As part of the cost cutting measures, Mouchel is restructuring the business into two main divisions – Infrastructure Services and Business Services – from the previous four divisions.
The group will focus on more profitable opportunities by adopting a new approach to contract bidding aimed at improving win rates and “cleansing the pipeline.”
Despite the gloom, Mouchel has £1.16bn order book as of 31 January 2012.
Grant Rumbes, Chief Executive, said:
"2012 is a year of transition for Mouchel. The first half of this financial year has remained challenging, but we are seeing signs of stabilisation in our core markets. We have completed our strategic review, which looks at every aspect of the business, and have started implementing the changes required to build on our market-leading positions in infrastructure and business services. These changes will concentrate on simplifying our operations and significantly reducing group support costs, while improving our technical ability and client focus. The changes we are announcing today will enhance our ability to deliver operational excellence to our clients. Our lenders are supportive of our plans.”
Mouchel’s share price fell 28% in early trading this morning.
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