A swiftly executed recovery plan, focused on streamlining management structures and reporting processes while adopting a more selective bidding approach, has brought the business back on track, with profitability forecasted to return soon.As part of the rebound strategy, the Simm family will inject £4m into the company over the course of this year, strengthening the balance sheet. Reports Contract Journal
Gareth Simm, CEO and grandson of the company’s founder, explained that the firm had faced challenges due to high inflationary pressures on fixed-price contracts and complications from several legacy projects in London.
To accommodate the implementation of this strategy, HE Simm extended its reporting period to 17 months.
Over the extended period, ending December 2023, the Liverpool-based specialist contractor saw revenue rise to £118m, up from £54m in 2022.
Simm noted that the order book remained strong at £150m, with numerous promising opportunities in the pipeline and several major projects set for completion this year. The company continues to operate 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.”
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