Spending cuts trim profits at WSP Group

The company warned of posting lower results last month as a result of spending cuts brought in by the coalition Government.

The Government is now one year into a five-year plan to eliminate the country’s budget deficit, which totalled more than 10 percent of GDP before they came into office in May 2010.

The company said it expects to undertake further restructuring action.

This would be in addition to the £2m already incurred during the reporting period, as the outlook for UK public sector works in roads and education sectors remains uncertain.

WSP, which is involved in building bridges and motorways apart from property and infrastructure, said it had cut its workforce by four per cent to 8,500 from 8,900.

January-June adjusted pretax profit was £14m, compared with £17m last year.

Revenue was marginally down to £362.2m.

WSP shares, which have shed 11 percent of their value after the company’s 2011 outlook, closed at 280 pence on Friday on the London Stock Exchange.

(Reporting by Juhi Arora in Bangalore; Editing by Prem Uday