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Shake-up continues at Mowlem

MOWLEM has lost its second senior director, as chief executive Simon Vivian sweeps his broom through the struggling contractor.

Paul Mainwaring will join Mowlem as financial director before May to replace axed Gerald Brown, who leaves after over 30 years with the firm.

Former chief executive John Gains has already stepped down, although he will remain a director until April.

Mr Brown's sudden departure from his £258,500 post after almost nine years was announced last week, as Mowlem admitted it was set to make a £7.5 million pre-tax loss for 2004.

Mr Vivian's detailed review of the business uncovered 'historic accounting issues' at the company's mechanical and electrical business, Mowlem Technical Services, which has been hit with bad debts dating back to 2001.

The firm said: 'We have discovered several works in progress and debtor balances within this business that are unlikely to be recoverable.'

Mowlem is also being forced to invest a further £4.1 million in its Alice-to-Darwin rail project in Australia - which the company part owns and operates - because of lower than expected revenues.

In December the firm also warned that it was writing down £15 million on underperforming construction and support services contracts.

Mr Vivian said: 'I have been forced to take some very tough decisions in respect of balance-sheet issues across the business.'