Infrastructure and outsourcing firm May Gurney has said it is addressing problems raised in last month’s profit warning as it announced an extension to its Somerset waste contract.
In a first-half trading performance update the firm, which provides waste management services to around 20 local authorities, said trading was in line with expectations.
In September the firm’s shares fell 46% to £120.25 after it said it would “significantly under-perform its original expectations” for the year, and that chief executive Philip Fellowes-Prynne would leave “with immediate effect”.
The company, which also provides outsources rail, road, and maintenance work, blamed the profit warning on problems with its loss-making kerbside sort collection contracts in Bristol and Chester.
The firm said today it had won a seven year extension to its contract with the Somerset Waste Partnership for recycling and waste collection services - valued at up to £100m.
The firm said in the first five months of the year it had won a total of £126m of new work and £150m of contract extensions. Its order book stands at £1.5bn.
As of 30 September, the group had gross cash of £20m and borrowings of £23m, with total borrowing facilities of £48m, comprising a £15m overdraft facility and a revolving facility of £33m. The group had obligations under contract-backed finance leases of £74m.
Willie MacDiarmid, interim chief executive, said: “Plans are in place to address the issues we highlighted in September and we are taking steps to reinforce the good work already started to give a clear focus on commercial disciplines.
“With robust operational improvements and efficiencies being driven forward, May Gurney is focused on delivering a solid future performance.”
The firm’s interim results for the six months to 30 September 2012 will be announced on 4 December 2012.