Profit hit belies strong trading at Glendale

Green services company Glendale has enacted an "onerous contract provision" to exit a major vegetation management contract that it signed in 2015, the company's recently published annual accounts have shown.

Parent company Alston Investments owns a group of companies including Glendale Managed Services, Glendale Countryside Management and Glendale Grounds Maintenance as well as golf construction, horticulture, health and consultancy businesses. It employed 1,366 staff at the end of last year.

The grounds management, arboriculture, countryside services and landscaping businesses enjoyed strong trading in 2015, resulting in revenues of £48m, up from £39.9m recorded in the previous year.

In 2014 they made £1.9m profit before tax but in 2015 they recorded losses before tax of £3.3m due to an onerous contract provision of £5m, allowing Glendale to pull out from its arboriculture contracts with Western Power Distribution (WPD) in the Midlands.

Glendale won the five-year £5.5m framework agreement with WPD in 2015 for vegetation management across the East and West Midlands, which it said at the time could create some 150 jobs. But the directors' report says the contract "suffered from significant underpricing, high mobilisation costs and operational inefficiencies". An exit was mutually agreed for 30 June.

The division's order book stood at £93m at the end of 2015, with the company securing new grounds maintenance contracts across the country and extending old ones - it now holds more than 70 contracts. It is also now one of the biggest arboriculture companies in the country and is continuing to bid for public sector and local authority work, although it is increasingly looking for private client revenue.

Revenue in Glendale Golf also increased last year by 30 per cent to £8.4m with profit before tax at £0.9m, up from a loss last year. However, the golf course market "remains a challenging environment in which to operate", the report points out. The recently developed Glendale Horticulture had revenues of £8.4m and made a loss before tax of £355,000.

Managing director Andy Corcoran left the firm on 31 March. Corcoran is now self-employed in another sector. Glendale declined to comment further on its accounts.

August 22nd: In an earlier edition of this story we incorrectly stated that Sue McGrath had left Glendale in March. McGrath still holds her position as group HR director with Alston Investments with HR responsibility for the Glendale group of companies but is no longer on the board of directors for Glendale. 


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