National maintenance group Rok reported a loss for the first six months of 2010 after restructuring its plumbing division.
Rok produced a pre-tax profit of £3m in the six months ended 30 June against £6m last time but this was wiped out and turned into a £3.8m loss by a £6.8m restructuring cost caused by job cuts and cancelled contracts in the plumbing heating and electrical division. Turnover was down slightly from £364.5m in H1 2009 to £308.1m in the first half of this year.
A spokesman for Rok today could not confirm the level of job losses as consultation with staff over redundancy or redeployment was ongoing.
Stephen Pettit, chairman, said in a statement: "Rok has a diversified range of revenue streams, a growing customer base, a strong order book with a very high level of visibility of work well into next year, significantly improved cash generation, and excellent customer satisfaction. The problems within PHE have been a regrettable chapter in Rok's history. Immediate and appropriate action was taken relating to the shortcomings in financial and operational control in this part of our Maintenance and Improvements operations as referred to in our recent trading update. The Board and management team are totally committed to rebuilding the strength of the business and delivering against expectations."
Rok has an order book of £435m and said it is seeing "good momentum" in its social housing and construction businesses.
Last week Rok suspended its financial director and issued a profits warning. Rok employs 571 people in the North West and North Wales with offices in Liverpool, Bolton, Rochdale and Llandudno.
The company will pay a dividend of 1p a share, down from 3.3p in summer 2009. Net debt reduced from £57m in mid 2009 to £47.6m.