Yahoo Finance Galliford Try hit by further costs on troubled Aberdeen bypass
Construction and housebuilding company Galliford Try is facing further costs for completing the troubled Aberdeen ring road, one of the projects which has been blamed for rival Carillion’s downfall.
Galliford said on Tuesday that it expected a “further exceptional charge” in the second half of the year, adding to £25m of extra costs for the project which it booked in the first six months.
The company had been in a joint venture with Balfour Beatty and Carillion to build the road, called the Aberdeen Western Peripheral Route, when Carillion collapsed into liquidation in January.
The two remaining partners were left to finish the work, which has been hit by a number of problems including persistent bad weather. Sections of the road are now open, Galliford said, and it expects the project to reach “substantial completion” this summer.
The road construction project had been cited as one of the contracts that put pressure on Carillion as it struggled to keep afloat last year. The delays and problems pushed costs up, squeezing its already tight margins.
Overall, Galliford Try said it expects a strong performance for the year, sending its shares up 1.86pc to 849p on Tuesday morning.
The company’s Linden Homes business delivered 3,442 housing completions in the year to end of June 2018, up from 3,296 last year, and its average private sales price rose to £367,000 from £354,000.
Overall, the division expects a strong performance and “further significant improvement” in the margin, Galliford said.
Its partnerships and regeneration division increased its order book from £1.05bn at this point last year to £1.2bn, and has increased its landbank by 22pc.
Peter Truscott, chief executive of Galliford Try, said the outlook for the rest of the year “remains in line with management's expectations”.
