In the year to 31st October 2023, Morrisroe Group made a pre-tax loss of £1.3m on turnover up 7% at £218.9m.
Materials price inflation, new legislation and planning blockages were variously blamed for the loss. A 29% rise in the price of reinforcing steel put Morrisroe’s concrete contracting numbers askew. The Building Safety Act requirement for a second staircase in buildings over 18 metres high affected the viability of a several residential schemes, causing some slowing in the high-rise residential market. And slippage on projects delayed by a variety of planning issues hit sales of Morrisroe’s demolition business, Cantillon.
On the plus side, the FY 2023 loss was significantly less than the £11.4m pre-tax loss shown in 2022’s restated accounts. That 2022 loss was originally reported in the accounts as £6.9m but a review of legacy projects threw up inaccuracies in cost forecasts and unforeseen problems in a specific concrete frame project.
Morrisroe has now embarked on a period of consolidation and modest retrenchment, being more cautious about the work that it competes for.
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Chief executive Brian Morrisroe writes in the 2023 accounts: “2023 was something of a mixed year. Although some of the inflated commodity prices experienced in the previous year softened to some extent in the third period of FY23, prices have remained relatively high and have continued to negatively impact margins in the main structures business due to ongoing commitments under some ‘legacy’ fixed price contracts entered into in previous periods. Our plant business was also negatively affected. On the other hand, our piling business saw significantly improved trading results as compared with the previous period despite prevailing marketing conditions, and our traditionally strong performers, Houston Cox and Piper Joinery, continued to report successful trading years. Our demolition business returned to profit despite a drop in sales.
“Although it is disappointing to report a further trading loss as a group, it is a substantially improved position as compared with the previous year as we emerge from a somewhat exceptional period in our trading history.”
He added that this year sales would be down 19% to around £175m, due to a more selective approach to tendering “but we feel that our reduced exposure will enable us to continue on our positive trajectory and allow us to invest time and energy into our longer-term improvement objectives.”
