Lancashire contractor sees profit rise despite turnover drop

Contractor Eric Wright has posted an increase in pre-tax profits despite a marked drop in turnover.

Accounts for the year ended 31 December 2021 published on Companies House this week by Henmead, the parent company of the Eric Wright Group, show its turnover declined from £204.6m to £163.9m following a reduction in its pipeline which it blamed on pandemic-related market conditions and project deferrals.

However, it reported a profit before tax of £13.2m, up from £8m in 2020, which it attributed to careful workload selection and effective commercial control and risk management.

According to the accounts, the group’s construction performance was good, on the back of strong commercial and operational control, a strict recruitment policy and active overhead management.

The Preston-headquartered firm’s property portfolio and other long-term investments also continued to generate stable returns, it said.

However, the group warned it would face a number of challenges this year, including uncertain project lead times, inflationary market pressures and supply chain disruption.

Finance director Gill Chadwick said the Eric Wright Group had benefited from having a diversity of principal activities including an investment property portfolio.

“Whilst global economic factors continue to create obstacles, the stability afforded by this breadth of activity, together with the strong performance of our investment property portfolio, provides the group with resilience and confidence, and ensures we are well positioned to capitalise on future opportunities,” she said.

“The outlook for 2022 is extremely positive with the business well placed to generate sustainable, profitable growth.”

Group managing director Jeremy Hartley said the company had remained focused on mitigating issues around pricing strategies and meeting the current “unprecedented” inflationary pressures.

“We aim to ensure that we do not take on any undue risk and continue to carefully consider and evaluate the deliverability of every new project,” he said.

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