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Montpellier haunted by problem jobs

Problem contracts continue to haunt Montpellier as the firm said this morning it is setting aside a further £1.9 million to clear up past liabilities.
The company uncovered huge problems in a review of YJL and Allenbuild contracts last year following the departure of former chief executive Paul Sellars.

Today's interim results for the six months to March show the company limping back into the black with a pre-tax profit of £147,000 compared with last year's disastrous £19.5 million pre-tax loss.

But the firm has spent £2.9 million clearing up the legacy deals, with a further £1.9 million set aside for further exposures.

Total exceptionals for the six months including redundancies at Allenbuild and the closure of YJL Construction amounted to £3.2 million.

Total exceptional costs are likely to be in the region of £6 million for the year.

The company appointed ex-Laing boss Brian May as chief executive last week, following Roy Harrison's stint to steady the ship as executive chairman.

Mr Harrison said: 'Our approach of phasing out exposure to high risk, low margin business areas is resulting in a much reduced risk profile going forward.'

Turnover for the half-year edged up 4 per cent from £212 million to £225 million. Montpellier's order book also stands at a healthy £582 million, although it has a restated pension deficit of £10.7 million.

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