Construction firm Stepnell reveals loss but says it is already profitable again

A BUILDING contractor behind a host of high-profile local developments has revealed a £5million loss but said it has returned to profit.

Stepnell, which has a regional office in Poole, revealed the loss in its accounts for 2019-20 but says it has since experienced a sustainable return to profit of £1m.

It says it has a strong order book for this year and into 2022.

Tom Wakeford, joint managing director of Stepnell Ltd, said the 2019-20 loss had been offset with the support of parent company Stepnell Holdings.

He said: “It goes without saying that 2020 was a challenging year for the construction industry. Many in the industry struggled through the Covid pandemic and despite working continuously through the various shut-downs, Stepnell was not immune to the increased costs of working and the delays in delivering projects.

“In 2019, we were impacted by onerous ground conditions on our largest project, which has proved expensive to remedy. We have taken a prudent position in our accounts, allowing our team to focus on the financial recovery on the project. March 2020 saw a write down of legacy contracts due to Covid-19 which had a profound effect on our clients and our sector as a whole.

“Therefore, 2019 and 2020 were difficult years for different reasons. The 2019 losses are now more than two years old and Stepnell looks very different, in a very positive way, in 2021, with an anticipated rise in profit to around £1m.”

The company said it had secured orders which would enable it to deliver sales in excess of £100m during 2020-21 in line with its business plan.

Mr Wakeford added: “Our balance sheet is more than £15m which is really strong. Our group has a property portfolio of more than £40m, giving us a strong base.”

Stepnell said it had recorded a Construction Net Promoter score, based on client feedback, well above average at 41.

Joint managing director Mark Wakeford said: “This is a great achievement, particularly in the current construction environment. We are hugely proud of this client feedback in what have been very challenging times. Key to this success is our ability to be involved early on in projects where we can understand our clients’ objectives and then ensure we work as a team to achieve them.

“We believe that in part, this assessment reflects how we adapted very quickly to the new way of working as a consequence of Covid-19 where all our sites remained operational. Our staff adjusted well to new ways of working on site, in our offices and at home.

“We remain cautiously optimistic that our revised business model, with a focus on early engagement and client and supply chain partnership, on lower risk terms and conditions, will hold us in good stead. Stepnell has a more diversified range of projects than ever before and this positions us well to withstand market risks.

“Strategically, Stepnell sees 2019/20 as a year of consolidation, carefully reviewing our customer base to be in line with our resources and the skills of our supply chain. We continue to refine project selectivity this year, being cautious and only signing up on the right commercial terms.”

Recent Stepnell projects in Dorset have included the £3.9m scheme to build a new boys’ boarding house at Canford School in Wimborne and £3.5m of building at Hamworthy’s Carter Community School. It is managing projects for Dorset Council and New Forest District Council among others.

Bournemouth Echo | News