POOR performances in the regions have led to a £37 million drop in profit for Laing O'Rourke.
Pre-tax profits at O'Rourke Investments fell from £60.7 million in 2004 to £23.8 million in the financial year ending March 2005. But the firm increased its turnover from £1.69 billion in 2004 to £2.12 billion during the same period, according to latest accounts released by Companies House this week.
A source at O'Rourke said the drop was partly down to tighter margins to win more jobs and an increase in wage costs due to direct employment.
He said: 'It has been the company's policy to switch all workers to direct employment and it has cost us an extra £6 million in increased costs to do that.' The results revealed that pre-tax profits at its London & South East business dropped by nearly £8 million from £8.2 million in 2004 to around £300,000 last year. And the Northern business made a loss of nearly £500,000 compared with a prof it of £3 million in 2004.
The Midlands business, which looked after the troubled Coventry City stadium project, dropped from a profit of £4.6 million in 2004 to a loss of nearly £3 million last year. The Scottish section dropped its profit from £6.5 million to £1.9 million.
The only section to perform well was Wales & West, which raised its profit from £3.7 million to £6.3 million.