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Engineering specialist hit by £10m loss

Engineering specialist C Spencer made a £9.8m pre-tax loss last year after taking a £14.5m hit on a problem project.

Accounts for the financial year ending 31 March 2018 showed the company had slumped to the loss following a £5.4m pre-tax profit in the previous year.

Turnover for the Hull-based firm was also down sharply from £113.2m to £75m.

Time and cost overruns on the problem project, which the firm did not name, was blamed for the loss, with the company also incurring liquidated damages of £4.5m. The project was completed last September.

A spokesman for the company said: ”The loss recorded in our latest accounts relates entirely to a single project, which incurred significant losses due to shortcomings in commercial controls.

“We have completed a thorough analysis of the root causes of these issues and we have taken rigorous corrective action to avoid any repetition.”

If the loss making project was excluded the company said it would have made a £4.3m pre-tax profit.

Completing the job led to a heavy net cash outflow of £11.1m. The firm took on a £6.4m overdraft facility and a £4.5m loan last year, finishing with cash reserves of £1.5m – down from £6.2m in the previous year.

For the current financial year ending 31 March 2019, the company said it had £108m of work in hand and was trading profitably.

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