Profit loss at Readie after ‘incredibly difficult’ year

Profit loss at Readie after ‘incredibly difficult’ year

Logistics and warehouse specialist Readie Management Limited has blamed inflation and supply-chain failures for a fall into the red in its financial results for the year ending 31 March 2023.

However, in accounts released at the same time as its parent company, Readie Construction Limited (the only trading company in the group) posted a £1.7m pre-tax profit, down from £5.5m the previous year.

Readie Construction’s turnover grew by 22 per cent from £345m to £421.1m.

A “disappointing” reduction in margin for Readie Management saw pre-tax profit fall from £1.92m to a loss of £1.35m. This was due to a £3.6m goodwill amortisation charge included within administration expenses.

The Essex-based firm, which two years ago became the largest contractor to become an employee-owned trust, employed 260 people in the financial year compared with 219 the year before. It sits in 55th place in the latest CN100 table of top contractors.

Readie Management’s annual report and financial statements show its pre-tax profit margin entered negative territory at -0.3 per cent after what it described as an “incredibly difficult” year for the industry. The firm posted a margin of 0.6 per cent in the previous financial year.

“While this [margin] is disappointing, there were a number of factors beyond our control that contributed to this deterioration,” said finance director Jessica McCarthy. “We had a number of projects that were delayed due to supply-chain failures, incurring additional prelim[inary] costs to the business, as well as additional costs to find replacement subcontractors at a higher cost.

“Inflation within the construction sector has been challenging and this has had an impact on margin, along with the return to more projects being competitively tendered, rather than negotiated.”

The firm’s year-end cash balance stood at £12.3m, up slightly from £11.1m the previous year.

Dividends of £741,000 were paid from Readie Construction to Readie Management, while directors’ remuneration rose from £1.5m to £1.6m.

During the year, Readie Construction worked on 41 projects and achieved 22 practical completions with a total of 3.8 million square feet of warehouse space delivered to clients.

This article was amended on 24 October to distinguish between Readie Management and Readie Construction

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