Shelved commercial projects cost McGee Group almost 40 per cent of its forecast turnover last year, according to chairman Ian Reeves.
McGee Group’s turnover in the year to 31 May 2009 totalled £62.8 million, down from £74.1m in the prior year.
But the specialist contractor had been on target to break the £100m mark in 2008/9 before a number of its projects were put on hold or scrapped altogether.
Mr Reeves said: “The turnover drop is a stark fall from where we were heading.
“In April 2008, when we were finalising our budget for the year ahead, we had projections for a turnover of about £100m.
“As we came through to June and July we had clients calling us up to say they had to postpone their projects.
“This reached its zenith when Lehman Brothers collapsed. We had to radically reassess our forward projection.”
Mr Reeves said a prime example of a mothballed project hitting McGee’s books was British Land’s 225 m-high Cheesegrater skyscraper in the City of London.
McGee was carrying out enabling works when the scheme was shelved in August 2008.
Mr Reeves said he expected turnover in the current year, ending 31 May 2010, to have dropped even further to about £50m. This would be roughly the level the firm was at when he joined in March 2007.
But he is expecting to increase turnover by about 20 per cent in the next 12 months as the firm diversifies into new markets and the office sector begins to recover.
“The commercial market has picked up a little and we are starting to see the benefits of people appreciating that we are capable in civils as well as building,” said Mr Reeves.
Mr Reeves said McGee’s strategy since 2007 had been to offer a full range of construction services.
While the firm principally acts as a specialist subcontractor, it is capable of offering the complete cycle of works on a project, including enabling, decontamination, decommissioning, demolition, piling, sub-structure and super-structure works, as well as waste management.
Declan Sherry was brought in from Laing O’Rourke last year as operations director, with a focus on developing McGee’s concrete and sub-structures offerings.
McGee has worked on two significant jobs over the past year that highlight its ability to take a project from start to finish - the regeneration of Stables Market in Camden and the construction of a new Ibis hotel in Gloucester.
The firm is also in talks with major contractors about becoming involved in projects worth up to £100m as a principal contractor joint venture partner.
The latest accounts show McGee made a pre-tax profit of £1.1m in 2008/9 - down from £1.6m the previous year.