Mark Whitehead 06 June 2019

Councils exposed following Kier profit warning

Councils exposed following Kier profit warning image

Local authorities are heavily exposed to struggling construction giant Kier which faced a huge fall in its share price this week, according to the latest figures.

Market analysts Tussell say the firm is named on 80 local authority contracts signed since 2015, with a total lifetime value of nearly £600m.

The biggest is a £210m contract with Shropshire started last April to repair the county's highways, estimated to be worth £21m a year.

Wiltshire County Council has contracts with the company worth £63.9m, while the third biggest customer is Durham County Council with £50m of business.

Kier announced on Monday that its underlying full-year profits would be far below earlier forecasts, leading to its shares plummeting by 41% to their lowest level since 1999.

The FTSE 250 company, which employs 20,000 people, builds and maintains infrastructure and buildings for the public and private sector such as roads, rail, schools, hospitals, student housing, prisons, offices and homes.

Large infrastructure projects include HS2 and London’s delayed Crossrail.

In December Kier launched a £264m emergency fundraising in a bid to avoid the same fate as Carillion, the construction and services company that collapsed in January 2018 forcing many local authorities to find alternative suppliers.

Tussell's founder Gus Tugendhat said: ‘Kier’s financial woes have been apparent for many months now.

'Kier differs to other struggling suppliers in that its contract portfolio is much more heavily weighted towards the wider public sector, particularly local government and higher education bodies.

'Whatever happens with Kier, it is essential that central government is sharing the lessons it has learned in managing risk in its supply chain with colleagues across the wider public sector.’

Highways jobs

Learning Support Practitioner Level 4- The Phoenix Collegiate

Sandwell Metropolitan Borough Council
Band D (£20,344 - £23,836 full time equivalent) (£15,808 - £18,521 Actual salary)
Looking to appoint a motivated, independent and flexible Learning Support Practitioner, to provide a... Sandwell, West Midlands
Recuriter: Sandwell Metropolitan Borough Council

Customer Services Apprentice

Telford & Wrekin Council
£3.90 per hour
Looking for someone who cares about customers. Telford, Shropshire
Recuriter: Telford & Wrekin Council

Broker

Kirklees Metropolitan Council
£19,554 - £21,166
Requirements of the job are... Kirklees, West Yorkshire
Recuriter: Kirklees Metropolitan Council

IT Technician - West Bromwich Collegiate Academy

Sandwell Metropolitan Borough Council
£20,344 - £23,836 per annum
Seeking an experienced ICT Technician to support our technological rich school. Applicants will... Sandwell, West Midlands
Recuriter: Sandwell Metropolitan Borough Council

Senior Finance Analyst - CYP

Brent Council
£55,638 - £58,779 p.a. inc.
To be suitable for the role you need to be a driven and motivated fully qualified accountant with... Wembley, London (Greater)
Recuriter: Brent Council

Local Government News

Latest issue - Local Goverrnemnt News

The March issue of Local Government News explores alternative funding channels that are available to councils beyond the Public Works Loan Board, what hurdles merging councils face in coming together, and how local government is handling GDPR.

This issue also has a special highways and street lighting section exploring how councils can use lighting to embark on their smart city journey and using IoT technology to weather the storm.

Register for your free magazine