A series of “very bad jobs” managed by the Manchester office of a North East construction firm has contributed to disappointing results and the loss of 30 jobs.
Tolent Construction Limited, which is headquartered in Gateshead, saw turnover decrease by 11.8% last year, going from £109m to £96m.
Financial statements for the year ended December 31, 2013, likewise show the company suffered a £2.8m loss before tax, compared to a £566,536 profit in 2012.
A report accompanying the results said the directors considered the figures “very disappointing”.
Company chairman John Wood, however, told the Journal: “A lot of the work in this period was picked in 2011 during the depths of the recession and most of the loss we’ve incurred can be attributed to our Manchester office, where we had a whole sequence of very bad jobs.
“We had struggled there for the last four or five years, and kept thinking maybe next year it would be better. But these were a series of design and build refurbishment jobs that proved to be a nightmare in terms of underestimations and the scope of the work.
“Finally, last year we decided to close the office and unfortunately, we had to make 30 staff redundant.”
Operating from four regional offices on a national basis, Tolent now employs around 400 people directly as well as several hundred sub-contractors.
It works across a wide range of sectors, including industrial, commercial, residential and petro-chemical, which affords it some protection against downturns in activity in certain markets.
However, the funding constraints on private developers and the public sector last year led to a more general contraction that continued to place pressure on margins for the firm.
The year, though, did see a number of significant projects undertaken, including a £8.5m contract for a new Morrisons supermarket in Morpeth, a £5.5m cinema complex project in Cramlington and £16m of civils work for a new energy-from-waste facility in Teesside.
Elsewhere in the country, Tolent has been responsible for a £10.8m student accommodation development in Coventry, a £5m Ramada Hotel in London, and £3m worth of care home refurbishments in Lancaster and Morecombe, among other large contracts.
The financial report said: “We enter the year with an improved order book and a number of good opportunities. The directors consider the result for the year to be very disappointing.
“The directors look forward to a return to profitability in 2014 whilst recognising it will be a challenging year in view of the slowly recovering general construction market.”
Mr Wood, likewise, said the firm was in the midst of a “transition year” that was seeing the market “getting back on its feet”.
“We’ve got a £120m order book,” he added. “It’s still a hard business to be in, but things are picking up.”
The directors are not recommending the payment of a dividend for the year.