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A swiftly implemented recovery plan to streamline management structures and reporting processes with more selective bidding has got the business back on track with a forecast return to profitability.
The rebound strategy also involves a £4m cash injection over this year by the Simm family to strengthen the balance sheet.
Gareth Simm, chief executive officer and one of the grandsons of the founder, said the firm was impacted by high inflationary pressures on fixed price contracts as well as issues from several legacy projects in London.
The HE Simm’s reporting period was extended to 17-months to implement the strategy.
Over the extended period to December 2023, revenue at the Liverpool-based specialist contractor was up at £118m (2022: £54m).
Simm said the order book remained strong at £150m with a healthy number of opportunities in the pipeline and several major projects due to be completed this year. The business remains free of bank debt.
“This has undoubtedly been one of the most difficult trading periods in our history,” he said
“Rigorous management reviews have been undertaken to ensure any operational performance issues have been recognised.
“Our review has reaffirmed that our focus needs to be on key – trusted – client and supply chain relationships, risk management and profitability in sectors where we have a competitive advantage and a proven track-record.
“The actions we have taken during the reporting period, which was extended to 17 months to accommodate the strategic restructuring, mean that we are already forecasting a return to profitability for the current financial year with operating margins that have recovered to an acceptable level.”
