West London-based mechanical and electrical (M&E) specialist Lorne Stewart has narrowed its pre-tax loss from £2.4m in 2023 to £1.6m last year, its latest financial results show.
However, the firm posted lower turnover of £101.6m in its latest accounts for the year to 31 December 2024, compared with £118.7m in 2023.
This resulted in a slightly narrower profit margin of 1.6 per cent last year compared with 2 per cent in 2023.
The strategic report accompanying the accounts said that Lorne Stewart “continues to face challenges due to multiple factors”.
These include inflation, the continuing fallout from Covid and its effect on supply chains, geopolitical tensions and trade restrictions.
Nonetheless, the company’s liquidity improved with cash in hand of £13.3m for 2024, up by one-third on the 2023 figure of £10m.
Lorne Stewart said this was down to “improved working capital management”.
Although it has no bank loans, the firm said it is dependent on its parent company, Saudi-owned LSRM Holdings, for working capital.
Lorne Stewart shed just two jobs in 2024 to retain 563 employees, but reduced its payroll costs from £31m in 2023 to £29.6m last year.
While it is looking to maintain its good relationships with existing clients, Lorne Stewart said it was also looking at “broadening the client base to mitigate the risk of overdependence”.
“Margins remain a challenge at all levels of the supply chain, making insolvency a high risk at client level, as well as at subcontractor/supplier level,” Lorne Stewart’s chief financial officer Ramesh Krishnamurthy said in a statement accompanying the accounts.
“The company is therefore rigorously maintaining compliance with its criteria for any new clients/supply chain,” he added.
Having paid no dividend in 2023, Lorne Stewart paid £2m to shareholders last year.
Going forward, the company sees better prospects, given the “current year’s financial performance has been largely affected by legacy projects which are now completed and cost taken.”
Since the period covered by its latest accounts, Lorne Stewart won a place on an £814m Pagabo facilities management framework, announced this January.