Covid-19 pushes Royal Bam Group into the red
Royal Bam Group, the Dutch parent of Bam Construct UK and Bam Nuttall, slipped into a £119m loss for the first half of 2020, following the “extraordinary circumstances” caused by covid-19.
Revenue at the firm fell by 19% in the second quarter of the year, compared to the same quarter a year before, while the business also suffered losses as a result of underperformance in its German construction and Dutch civil engineering businesses.
Meanwhile, UK civil engineering and Bam PPP, as well as Dutch construction and property all performed well.
Revenue for the first half of the year was down 10% to £2.8bn, mainly due to the impact of covid-19. However, the company said it expected to move back into profit in the second half of the year.
Frans den Houter, chief financial officer and interim CEO of Royal Bam Group said: “This has been a challenging half year, particularly because of the impact of covid-19 in combination with underperformance in several businesses. With safe working as our top priority, our focus has been on reducing costs and capex, preserving cash and strengthening liquidity. We have started the process of winding down Bam International following continued losses over the last few years, the deterioration of the oil and gas market and the lack of attractive alternative opportunities.
“We are of course disappointed with the reported loss, for a large part caused by the unprecedented Covid-19 pandemic. We adapted to different governmental restrictions across our various markets in close cooperation with all our stakeholders. Our people responded quickly and effectively to the challenges. Nevertheless, in April and May, our average operational efficiency reduced to approximately 65%. This improved to 80% in June and is now nearly back to 90%. Although we see short-term uncertainty in parts of our construction business line where private commercial developers are reviewing their plans, civil engineering markets remain positive as governments initiate investment programmes to stimulate the economy. Our strong order book and cash position show that Bam is a resilient company.”
“Based on current market and Covid-19 conditions and the strong order book, we expect a positive adjusted result before tax for the second half of 2020.”