The Miller Group today revealed a 25 per cent drop in 2009 turnover due to not chasing work at reduced margins.
Miller’s turnover for the year to 31 December 2009 fell to £783 million from £1.05 billion, while the firm made a £72.4 million pre-tax loss compared to a loss of £170 million in 2008.
The loss was partly due to exceptional costs of £27.5 million with the firm reducing its staff number by 20 per cent to 1,200 at the end of 2009 from 1,500 in 2008.
But chief executive Keith Miller told Construction News that Miller was re-hiring staff once with the housing and commercial property markets now past the worst.
The group has started 17 new housing developments since mid-2009 as well commencing work on its 11 m sq ft commercial portfolio at sites in Edinburgh, Birmingham, Warrington and Islington in London.
Mr Miller said: “We are reasonably positive. It has been a tough year, but the worst is behind us.
“We are now taking on people again in certain areas. Staff numbers overall fell last year because of the drop in construction revenue.
“We haven’t chased the market down in terms of securing turnover at unreasonable margins.”
Miller’s construction turnover fell to £409.2 million from £622.1 million.But the decision to not chase work meant the division achieved a profit before interest of £15.5 million, up from £13.7 million in 2008 giving strong operating margins of 3.8 per cent, up from 2.2 per cent the prior year.
Housing turnover dropped slightly to £331.3 million from £358 million despite housing sales increasing to 2,068 from 2,056.
Miller generated £130 million of cash from operations which will allow early repayment of £100 million of group debt in first quarter of 2010.
Mr Miller said: “The early and decisive action we took to reorganise our finances and landbanks, and rationalise our cost base has stood us in good stead.
“We have 33 sites in our strategic land portfolio which are progressing well through the planning process, and these are expected to produce approximately 14,000 plots in the next 5 years.
“All will be acquired at superior margins, and the first 1,000 plots should be acquired in 2010/2011.
“Our commercial property portfolio is in good shape, making a positive return over both direct operational and finance costs. We have recommenced activity on our major strategic landholdings in Islington, Birmingham, Warrington and Edinburgh.
“The construction market is challenging, but we have good visibility of work in the medium term, a strong brand and an excellent client base.”