Muir Group earnings fall as contracting arm takes hit

Muir Group, the Fife-based contractor, housebuilder and property developer, has reported a fall in annual profits as “bad debt” and challenges in its contracting arm dragged on earnings.

Muir group chairman and founder John Muir praised 'a positive set of results given the challenging environment the construction industry is facing'. Picture: Contributed

The family-owned builder hailed positive results in a “challenging” environment, as pre-tax profits for the 12 months to 3 February dropped to £2.6 million, down from £3.3m in the previous year.

The Inverkeithing group, which includes Muir Construction and Muir Homes, attributed this decline to “potential bad debt”.

Muir said a provision of its full outstanding debt of £1.6m has been made, however the debtor is currently undergoing refinancing and “has given assurances that £1.1m of this sum will paid on completion”.

A one-off charge for pensions equalisation also affected other returns.

Its contracting division, which posted a loss of £523,000 compared to profits of £818,000 last year, also weighed on group earnings.

Profits at Muir’s housing arm remained flat at just under £3.3m.

Muir praised consistent revenues in an “uncertain” economic climate, recording broadly flat group turnover of £65.1m and pointing to key growth in the private housing, property development and timber kit manufacturing sectors.

Turnover in its housing unit increased by around 10 per cent to £32m, while its contracting business took a £6m hit with revenues of £24m.

In reports filed to Companies House, finance director James Watt said this was “principally down to lower construction opportunities with a higher level of house building and development activity”.

The average house price climbed by £12,000 to £206,000, while the number of house sales rose to 157 homes from 152 last year.

Muir announced an upbeat outlook for the current year, praising a “robust pipeline of activity”.

The group, which employs 267 staff, is currently working with prospective tenants for turnkey developments at Glasgow Business Park, and has already let a 10,000-square-foot office at

Aberdeen Gateway to decommissioning specialist Well-Safe.

Construction work is also underway at a 74,500-sq-ft warehouse and blend facility in East Kilbride for multinational brewing and beverage company Distell International.

Group chairman and company founder John Muir said: “This is a positive set of results given the challenging environment the construction industry is facing.

“Looking forward, the group is well positioned, with a strong debt free balance sheet and returns are expected to show a significant improvement in the current financial year.”