PROFITABILITY has stalled at Lincoln-based contracting group Simons as a result of delays on jobs the firm is helping to develop and slimming down its client roster.
Pre-tax profits dropped £500,000 to £800,000 in the year to March 2004 and turnover fell £48 million to £179.7 million as Simons focused on working for a handful of clients such as Asda, B&Q, J Sainsbury and Boots.
Chief executive Paul Hodgkinson said: 'In continually striving to do a lot with a few, the majority of our construction activity is now achieved through rolling programme, partnered and negotiated procurement methods. Our core competencies are focused on our selected services to retail, leisure, health care and commercial key accounts.
'While this focus has resulted in a short-term reduction in activity, the transition has significantly improved the quality of earnings from our construction business and strengthened our cash flow.'
At the end of the year Simons had a cash balance of £20.8 million - up from £16.4 million a year ago.With workload down, Simons cut the number of workers on its books by 14 per cent to 367 and the wage bill fell by £2.6 million to £19.2 million but operating profits crumbled £586,000 to £324,000.