Fresh concerns have been raised over the future of outsourcing giant Interserve following a huge drop in its share price.
Shares in the UK-based global construction and support services company, which has several contracts with local authorities, hit a 30-year low on Monday amid speculation it may not be able to raise the cash it needs to continue operating.
They have rallied slightly since but continue to be volatile and far below their historical value.
The company hit back claiming its transformation programme adopted last year is on track and it expects to make improved profits this year.
It is the latest outsourcing company causing concern after construction specialist Carillion went bust earlier this year leaving the taxpayer with a £148m bill and forcing many local authorities forced to find alternative contractors.
Interserve has operations in more than 40 countries providing construction, equipment, facilities management and 'citizen services' in sectors ranging from aviation to retail, oil and gas, the nuclear industry and leisure services.
It lists local government as one of its major sectors, claiming: 'We are an intelligent and strategic partner with deep experience of supporting local government. We work closely with councils to tackle problems, transform communities and change lives.'
Earlier this year York City Council terminated a £9m contract with Interserve amid spiralling costs to refurbish its historic Guildhall.
In October last year the company announced a transformation plan to save £15m which included an estimated 1,500 job losses.
It admitted at the time its financial performance was 'extremely poor' and many of its problems were 'self-inflicted mistakes of the past' with 'inadequate financial and operating discipline'.
Today it said in a statement: 'Interserve notes recent press commentary surrounding the Group and the movement in its share price.
'Interserve confirms that the implementation of the Group’s strategy and the Fit for Growth transformation programme remains on track and the Group continues to expect a significant operating profit improvement in 2018, in line with management’s expectations.'
Photo: Graham Richardson/flickr