Building services firm T Clarke has warned the market that it expects a “significant reduction in profits” due to a “sizeable loss” after a dispute settlement on a major project.
In an interim management statement for the period from 1 July to 7 October 2014, T Clarke said it expects to report underlying pre-tax profits of between £0.5m and £1m for the full 2014 year.
For the year to 31 December 2013, the company’s pre-tax profit was £1.7m.
It said a final settlement in respect of a damages claim for one of its subsidiary companies will result in an exceptional charge of £0.2m in the second half of 2014.
It also said T Clarke will be hit by a “sizeable loss” on a major project within its Mission Critical data and power division, due to paying a settlement on a disputed final account with a main contractor.
The statement said the board “took what it believed to be a pragmatic view to avoid costly litigation” and that since the settlement it had secured projects worth more than £25m from the main contractor concerned.
At 30 September, T Clarke’s order book stood at a record £280m, up from £275m at 30 June 2014.
It said: “This strong order book and pipeline provides your board with significant confidence for the future prosperity and further development of T Clarke.”