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Fri September 24 2021

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Late payments hit WSP

15 Dec 10 Late payment of debts by clients managing their cash more tightly is likely to increase the end-of-year debt burden at consulting engineer WSP Group.

In a pre-close update, WSP said that 2010 had “proved challenging in varied but generally difficult markets”.

Despite higher than expect debt, the group will continue to comfortably comply with its banking covenants and remains well financed with a £150m committed credit line through to 2013, it said.

WSP has a five-year strategic plan that includes the disposal of non-core activities. It has sold a loss-making testing laboratory in its UK Environment & Energy business and its is progressing a planned disposal of its small UK donor aid business.

The company is also restructuring CEL, its industrial process business, which has struggled during the recent downturn. CEL is being integrated it into the core UK operations. Net losses associated with these actions, including the partial write-off of the goodwill associated with CEL, will be reported as an exceptional item in the 2010 accounts.

WSP expects the UK market “to remain subdued as a consequence of reduced public sector spending and without a compensating recovery in the private sector”. 

It is more optimistic about its overseas activities.

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