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Bonuses slash Brown Macs' profits

Bumper bonuses for directors helped drag down pre-tax profits at civils and utility contractor Skanska McNicholas by nearly £4 million last year.

The results filed at Companies House, which cover the year to 31 December 2006, are effectively the last set of figures from McNicholas Plc. It was bought for £50 million by Skanska last December after nearly 50 years of independence.

The Swedish giant took over Brown Macs in the first week of that month after first making a move on the firm in the summer of 2006.

In a statement, Skanska McNicholas said: “Due to the recognition and payment of significant incentives to directors and senior management, however, profit before tax reduced from £5.6 million to £1.8 million.”

Turnover went up 8 per cent to £181 million but the aggregate take home pay of directors rocketed by over £2 million to £3.6 million while the highest paid director saw his salary more than double to £737,000.

In the statement, the firm added: “The Power division’s faults and connections contracts for EDF Energy continued to underperform.”

It also said that a adjudication on a claim, known as Sumps and Pumps, with tube maintainer Tube Lines “produced a result which fell below expectations”.

It added that finishing a contract in Pirbright, Surrey, at its discontinued building arm “was proving troublesome” with substantial completion not expected until the middle of 2007.

Staff numbers in the period fell by around 150 but overall wages went up by £1.5 million to £43.8 million.