Galliford Try have confirmed that up to 350 jobs will be lost after deciding to shrink its construction division by nearly a third.
The news follows the company’s announcement back in April that it was planning to review and scale back its main construction arm, which would lead to a consequential fall in 2019 profit of up to £40m.
Chief executive Graham Prothero was appointed in March after stepping up from financial director on the departure of Peter Truscott, and quickly made it clear his number one priority was to whip the construction business into shape. The group has taken some big hits in recent years, thanks in no small part to the Aberdeen western peripheral route project that has led to around £150m in extra costs leaving the business and they suffered another big body blow last year when one of its partners on the Aberdeen bypass, Carillion, collapsed, leaving Galliford with extra costs of £38m.
The company has now confirmed that the restructure was going ahead “to simplify the business and management structure and to refocus on key strengths in markets and sectors with long-term growth and profitability potential”.
Galliford will now concentrate on just three sectors - building, water and highways. It already opted out of bidding on fixed-price major projects in 2016. The restructured business's target annual revenue will reduce from last year’s £1.7bn to approximately £1.3bn, generating anticipated cost savings of up to £15m a year by 2021 in a quest for operating margins of 2% by that same year.
Prothero said: "We have made some difficult decisions in response to the challenges faced by the group's construction business. The associated operational changes are being implemented across the business. We are confident that the decision to refocus our construction activities will deliver a more stable business for the future and support improved margins.”
Galliford Try has played a major role in delivering some of the UK’s most high profile and innovative schemes, including the Queensferry Crossing, the retractable roof at Wimbledon centre court, several major hospitals and numerous road and housing schemes.