Latest statement shines light on industry issues.
It is two months since we reported that Coleman Group was restructuring amidst financial challenges caused by the COVID-19 pandemic. But fresh details filed with Companies House reveals that this is just one of the issues facing the company.
According to Construction News today, the company took a £1.7 million hit when a subcontractor defaulted and failed to complete a contract. Meanwhile, Inside Media has reported that unneeded business premises have also been either disposed of or let to third parties, with CNC (the holding company) divesting itself of excess plant and machinery to the value of £2.0 million.
But it is the reasoning behind these decisions that will likely strike a chord with the wider UK demolition industry:
“The directors are of the opinion that the industry is suffering in an environment where work is won on price alone and that demolition contractors are expected to take on all risks for little reward.
As a consequence, they have decided to refocus on clients who work in a more collaborative way, including long-standing clients of the group and not to chase high risk, low margin opportunities. This will result in lower turnover going forward but will improve profitability.
These changes will ensure that the group has the correct recourses to complete the solid and profitable work already secured for 2021.”