Galliford Try to raise £150m after Carillion collapse

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"We have reviewed the impact on our business from the compulsory liquidation of Carillion, which has resulted in a further reassessment of the likely out-turn from our participation in the Aberdeen Western Peripheral Route (AWPR) joint venture, leading to an exceptional charge of £25m".

Following the crash of Carillion, the firms' joint venture on the Aberdeen Western Peripheral Route road has been delayed.

Several British builders have been hit by writedowns and warnings in the past decade as rising wages and unexpected costs on fixed-price contracts with thin margins led to losses.

Galliford Try, Carillion and fellow construction firm Balfour Beatty were contracted to build the bypass for £550m but Carillion's demise has left the two other companies facing additional costs. But without raising new capital, it said this would involve diverting capital away from the Linden Homes and Partnerships & Regeneration businesses, which would reduce their ability to capitalise on growth opportunities.

The company aims collect the sum in the coming weeks in order progress its dividend cover increase, bringing the plan into the current financial year.

Meanwhile, the housebuilder's results in the half-year results to 31 December 2017 showed "strong financial and operational performance".

Linden Homes has seen a strong first half, with revenue increasing 7% to £436.8 million against the equivalent period the previous year.

While the group pre-tax profit figure was down 11% on past year, net debt was also substantially reduced from £113.8m to £84.9m. Despite today's announcement, Galliford have emphasised they "continue to maintain strict control over net debt, which is consequently better than our guided level".

The housing division entered the second half of its financial year with a "solid" forward order book, and total sales now reserved, contracted and completed of £879 million against the previous year's £857 million.

This article was published on 14 Feb 2018 (last updated on 14 Feb 2018).