Redhall counts cost of losing contract

The company said it believed trading would get better in the second half of the financial year.

Revenue for the half year to March 31 2011 was £64.3m, which is down on the 2010 half year comparative of £65.4m.

Adjusted profit before tax was down by 70 per cent at £1m.

The company said the underperformance was principally due to the loss of a major contract with Vivergo Fuels, but the business was also affected by a lower level of manufacturing orders from its principal civil nuclear client, Sellafield, and a more competitive environment in the oil and gas sector.

The defence sector continued to perform well, and the outlook for the second half of the current financial year and beyond was helped by the award of the first phase of a £20m contract with AWE, which was announced in February.

David Jackson, the chairman and chief executive of Redhall, said: “Our business has suffered a set-back with the cessation of the Vivergo contract which has contributed to a disappointing first half result.

“The board believes this is a low point and trading will be much improved in the second half and beyond. We are deeply committed to resolving the Vivergo issue and restoring shareholder value.”