“The deterioration in performance… will have a significant effect on overall group performance in the near term,” Cape said. Profits in the current year would therefore miss expectations and problems in Asia are “expected to persist into 2013”.
“Lower revenue, combined with increasing pricing pressure, has led to operating margins being significantly lower than previously expected,” the business said. “With delays in major project works in Australia now apparent, no improvement in activity levels is expected in the near term.”
Analysts were concerned that the business failed to win the expected number of contracts.
“Although we felt the share price was pricing in contract slippage, we are disappointed that work packages that we were confident Cape would win have been lost – and this could delay the rate of recovery,” Michael O’Brien, an analyst at Cannacord Genuity, said.
“In addition, we believe that although revenues in the Arabian Gulf are progressing well, margins will be slightly lower than expectations,” Mr O’Brien added. “Given this is Cape’s highest margin area by a long stretch we believe this may concern some investors.”
Cape now expects operating margin, before the impact of any restructuring, to reduce to about half of 2011 levels.
The profit warning was Cape’s third since November. In May, the shares plunged after the group revealed there were problems with a contract in Algeria which would result in a £14m charge. This followed a warning in November in which the company said margin pressure in the Middle East would crimp earnings, as it took a surprise one-off charge for a contract in the North Sea.
Joe Oatley, Cape’s new chief executive, joined the company on June 29 and will now begin a review of the Australian region’s business structure and cut costs.
The shares fell 102.9p to 187p.
News Source: telegraph.co.uk
The administrators, David Hill, Julie Anne Palmer and Peter Dewey of Begbies Traynor, were drafted in to the company in early July, and then sold the business and assets on to Dixon Pentland Scaffolding Ltd and MTL Scaffolding Ltd, two related companies, for £390,000.
Two ‘Time to Pay’ agreements had been made with HMRC, but were both cancelled in early 2012 after the firm did not meet a payment of £10,000.
Established in 1968 by Mike Dixon, Dixon Scaffolding (Transmission) specialised in scaffolding for the energy and heavy industrial industries and had over 100 staff.
Mr Dixon took semi-retirement and bought in a new managing director and management team to run the business in 2009. A temporary dip in work from its largest customer the National Grid and some new long-term contracts at “uncompetitive prices” led to a loss of £633,000 for the year ending 31 December 2010.
The new management team exited the firm in May 2011, and Mr Dixon took the helm once again. Despite his efforts to bring the firm back to profit, losses of £293,000 were reported for the year ending 31 December 2011.
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The 61-year-old, who does not wish to be named, sustained multiple fractures in the incident at a house undergoing refurbishment on Lancaster Avenue, Hitchin, on 27 May 2010.
He fell approximately five metres to the ground and has yet to make a full recovery, or return to work.
Stevenage Magistrates’ Court heard that Stevenson’s P&H Ltd was the main contractor at the property.
An investigation by the Health & Safety Executive (HSE) found that the company had provided scaffolding, but had failed to fit suitable edge protection, such as a handrail, mid-rail or toe board, in the section where the fall occurred.
Stevenson’s P&H Ltd, registered to Wakefield House, High Street, Pinner, pleaded guilty to breaching Section 2(1) of the Health and Safety at Work etc. Act 1974. The company was fined £20,000 and ordered to pay £7,373 in costs.
After the hearing, HSE principal inspector Norman Macritchie said: “Falls from height are all too common in the construction industry, with unsafe scaffolding often the root cause. The risks are well known and safe-working guidance is readily available, yet still entirely preventable incidents occur – as was the case here.
“The painful, potentially life-changing injuries the worker sustained could have been avoided by the simple provision of edge protection on the section of scaffolding he fell from.
“It is vital that work at height is properly planned and organised, and that all necessary precautions are taken to protect workers.”
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Any work over 2.4 meters will now require scaffolding under the new Best Practice Guidelines for Working at Heights. This means that all single-story buildings will require scaffolding – something that was not required before which will now add thousands to the cost of each build.
Prepared by the Department of Labour with the Roofing Association of New Zealand, the guidelines will bring changes to the way tradesmen work at any height deemed dangerous.
Failure to meet the guidelines can lead to enforcement by health and safety inspectors such as a written warning, a prohibition notice, an infringement fine or in the most serious cases, prosecution.
While there was confusion within the building industry over what the guideline specifications and expectations were, Department of Labour inspector Marcus Nalter said no minimum height restrictions existed.
“It’s not the height that we focus on, it’s the fall because even at low falls people are getting seriously injured or even killed,” he said.
The employer therefore had a responsibility to take all practical steps to ensure work places were safe. That required them to eliminate, isolate and minimise risks.
About 50 inspectors would be visiting work sites nationwide ensuring guidelines were being met.
Hassall Homes Ltd managing director Rodger Hassall said the costs for extra scaffolding would fall directly onto the consumer.
Mr Hassall, who has been in the building industry for 40 years, said the regulations were going too far. “I think it’s going a little bit over board with a single-storey dwelling.”
For an average home the extra scaffolding would cost a couple of thousand dollars, he said.
G.J. Gardner Homes Taranaki managing director Kevin Jarvis said his company would comply with any regulations.
“If the statistics prove it will benefit staff and workers on site then we’re all for it,” he said.
Installing the additional scaffolding would add costs and time and create logistical difficulties.
“They need to understand the impact it’s going to have on the construction industry. It will cause some challenges as to how we do a job yet still comply,” he said.
Master Builders president and Taranaki builder Dave Fabish said, though it would increase costs to the customer, he supported anything aimed at improving safety standards.
Adopting the regulations would require a significant culture shift.
“It does come at a cost and it does make housing work a bit less affordable but it’s for a good cause,” Mr Fabish said.
He didn’t think the regulations went too far.
Roofing Association president Graham Moor said to see scaffolding and edge protection being used on single level dwellings was a quantum leap for the industry.
“But there’s still work to do.”
Department of Labour harm reduction programme manager Francois Barton said the new regulations were aimed at reducing the human and financial toll caused by falls from height.
“More than half the falls from height reported to the Department are happening from under three metres and most of these falls are from roofs and ladders,” Mr Barton said.
The Department of Labour has set a target of a 25 per cent reduction in serious injuries and deaths by 2020.
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A long-timetime advocate of the need for more detailed data, the Association says the latest figures, although clearly important, do little or nothing to help identify the cause of these fatalities. Such data, claims PASMA, is essential to help target information and initiatives at those areas needing it most.
Firmly committed to advancing safety and best practice in the work at height sector – a major cause of workplace injuries and deaths – the Association says the need for in depth information is paramount in order to help influence future outcomes and enable all organisations who champion safety to focus their attention where it matters most.
Comments Neil Tomlinson, PASMA’s head of marketing and communications: “Only in this way will we be able to prioritise, direct and take the action necessary to influence the figures and be able to demonstrably show progress on significantly reducing accident statistics. Not only in the UK, but ultimately internationally.” 
