POTENTIAL contracts for rail and new nuclear power stations point to a bright future, insisted engineer Redhall Group after reporting a year of losses.
The Wakefield-based group has been dogged by troublesome “legacy” contracts and a legal dispute over the past two years, which drove it to £4.6m pre-tax losses in the 12 months to the end of September. That followed £8.1m pre-tax losses the prior year.
“Fundamentally what we’ve got in Redhall is a fantastic core business that’s had some isolated problems that have caused it a lot of financial pain over the last two years,” said new chief executive Richard Shuttleworth.
Redhall went to the High Court over a disputed contract at the Vivergo biofuel plant in East Yorkshire, and expects a judgment next year. It also had production problems with a £20m contract to build doors for the Atomic Weapons Establishment (AWE).
Underlying revenues fell six per cent to £119.5m, once Vivergo and other legacy contracts were stripped out.
It plans to shift its focus from contract work and towards more manufacturing, where margins are greater and risk lower. Three “small non-core” business will be sold and it also plans small acquisitions.
Mr Shuttleworth added a string of opportunities are emerging in manufacturing, including defence work worth £15m, blast-proof doors for London’s Crossrail line worth £12m, and multi-million pound deals for doors and “pond-liners” at the new Hinkley nuclear power station.