Mark Whitehead 06 June 2019

Councils exposed following Kier profit warning

Local authorities are heavily exposed to struggling construction giant Kier which faced a huge fall in its share price this week, according to the latest figures.

Market analysts Tussell say the firm is named on 80 local authority contracts signed since 2015, with a total lifetime value of nearly £600m.

The biggest is a £210m contract with Shropshire started last April to repair the county's highways, estimated to be worth £21m a year.

Wiltshire County Council has contracts with the company worth £63.9m, while the third biggest customer is Durham County Council with £50m of business.

Kier announced on Monday that its underlying full-year profits would be far below earlier forecasts, leading to its shares plummeting by 41% to their lowest level since 1999.

The FTSE 250 company, which employs 20,000 people, builds and maintains infrastructure and buildings for the public and private sector such as roads, rail, schools, hospitals, student housing, prisons, offices and homes.

Large infrastructure projects include HS2 and London’s delayed Crossrail.

In December Kier launched a £264m emergency fundraising in a bid to avoid the same fate as Carillion, the construction and services company that collapsed in January 2018 forcing many local authorities to find alternative suppliers.

Tussell's founder Gus Tugendhat said: ‘Kier’s financial woes have been apparent for many months now.

'Kier differs to other struggling suppliers in that its contract portfolio is much more heavily weighted towards the wider public sector, particularly local government and higher education bodies.

'Whatever happens with Kier, it is essential that central government is sharing the lessons it has learned in managing risk in its supply chain with colleagues across the wider public sector.’

SIGN UP
For your free daily news bulletin
Highways jobs

Senior Social Worker

London Borough of Richmond upon Thames and London Borough of Wandsworth
£46,206 - £55,992
Senior Social Worker
Recuriter: London Borough of Richmond upon Thames and London Borough of Wandsworth

Waste Operations Support Officers

Durham County Council
£29,071 - £32,046
Temporary until 1 June 2029   Refuse and Recycling are looking for 3 Waste Operations Support Officer to work in the South and East of County Durham. Peterlee
Recuriter: Durham County Council

Recovery Worker

Durham County Council
Grade 7 - £31,015 – £34,811 per annum.
Do you want to make a real difference to the lives of people experiencing hoarding and self-neglect behaviours?   As an Agile Recovery Worker within o Durham
Recuriter: Durham County Council

Finance Officer

Durham County Council
Grade 7, £30,024 - £33,699 per annum. Pay award pending.
We are seeking a Finance Officer to join DurhamLearn, where you will play a key role in supporting the financial administration, budget monitoring and Durham
Recuriter: Durham County Council

Social Work Consultant

Durham County Council
Grade 13 - £47,181 - £51,356 (Pay Award Pending)
Do you believe every child deserves to grow up feeling loved, safe, and supported, with a lasting sense of family, belonging, and stability?   Are you Durham
Recuriter: Durham County Council
Linkedin Banner