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Hitches hit Lend Lease

FINANCE

PROFITS at Anglo-Australian contracting giant Bovis Lend Lease have been dented by problems with subcontractors on two big negotiated design and build jobs.

The firm took a £14 million hit for provisions on its Bridgewater Place scheme in Leeds and on a redevelopment of the BBC's Broadcasting House in central London.

Jason Millett, BLL's UK chief executive, said: 'With Bridgewater, losing your concrete frame contractor on a major high-rise project was always going to be difficult.' The concrete frame contractor on Bridgewater, RCG, went down in June 2005 and was replaced by PC Harrington. High winds on the scheme also caused problems.

On the BBC job, the UK arm of Mero went down and the cladding outfit's German parent had to take over this package. Another subcontractor, Eastern Masonry, also had to be replaced, this time by PAYE Stoneworks.

Mr Millett said: 'At the BBC, testing and commissioning took longer than expected.' He stressed that BLL was not financially at odds with the client on either job.

In the second half of 2005, the UK/EMEA region of Lend Lease, which includes Bovis Lend Lease, made a pre-tax profit of £466,500 on operating revenue of £611.7 million.

Lend Lease's acquisition of North West-based Crosby Homes from Berkeley last summer helped double profits at the retail and communities arm to £41.6 million.

Bovis Lend Lease has yet to do any work for Crosby but Mr Millett hopes to change this next year.