Wates turnover falls 11%, but year ends with record order book of £6.6bn

The Wates Group secured £2.4bn of new work in 2020 enabling it to end the year with a record forward order book of £6.6bn, up 13.5% from 2019.

The company’s annual report for the year ending 31 December 2020 saw group turnover, at £1.45bn, fall 11.3% during what the company described as “one of the most challenging years in its 124-year history.” 

The group delivered pre-tax profits of £1.7m (after exceptional costs of £11.4m) from a turnover of £1.45bn. It ended the year with £215.9m of cash (and £161.6m of net cash, which was £50.8m up on 2019) and, in addition, has access to an undrawn £120m revolving credit facility.

The group accessed £50m of bank funding through the Coronavirus Large Business Interruption Loan Scheme and received £7.7m of income from the Coronavirus Job Retention Scheme. As a UK-based employer, the group made a total tax contribution of £107m to the exchequer.

The business says it adapted quickly and effectively to the restrictions imposed as a result of the pandemic, with site productivity in the final quarter of the year approaching pre-pandemic levels, creating real optimism for 2021 and beyond.

Wates maintained continuous working throughout the pandemic, other than one pause in operations for less than three days in March 2020, with site productivity restored to 94% by December 2020.

A maximum of 1,400 Wates employees were furloughed during first UK-wide lockdown, with no workers remaining on furlough from October. Pay cuts imposed for staff working during the first three months of lockdown were reimbursed in full in February 2021 salaries.

The report also highlighted 268 redundancies following the contraction in the size of the business in 2020, equivalent to a 7% reduction in personnel.

David Allen, Wates Group chief executive, said: “We began 2020 with enormous optimism, having just achieved the highest level of profits the group had generated for almost a decade and a record order book. Within three months, the pandemic left us facing a battle for survival. That we finished the year with a positive result is a credit to the remarkable efforts, resilience and adaptability of everyone at Wates.

“The pandemic challenged us to work in different ways and to adapt. We reorganised our business to focus on helping to tackle the UK’s housing shortage, supporting the public sector to build back better and investing in the modern methods of construction that will enable us to meet our customer’s needs in the future. Together, we have set the business up to succeed and we remain committed to our goal of becoming the most sustainable, trusted and progressive business in the sector.”

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