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Vinci expects operating costs to eat into increased turnover

FINANCE

PROFITABILITY at Vinci plc, formerly Norwest Holst, has fallen despite turnover rising a third due to the French-owned firm's UK acquisitions.

Vinci bought Crispin & Borst, a £70 million turnover contractor from London, last January for an undisclosed fee, and this was one of the main reasons behind turnover rising £108 million to £451 million.

A Vinci spokeswoman said: 'There was an exceptional income in 2001 due to the sale of investments such as intermediate holdings and dormant companies.

'This did not therefore affect the trading of the group and accounts for almost the entire difference between the profit after tax in 2001 and 2002.'

Pre-tax profits dropped £1.1 million to £9.9 million, despite orders rising on last year, the firm's margins are under pressure.

The spokeswoman added: 'Operating costs increased in 2002 and the trend is for a further increase in 2003 due to the decline of the stock market, increasing pension liabilities, insurance premiums and national insurance.'