Losses force Mouchel to scrap final dividend

By DAILY MAIL REPORTER
Updated: 07:52 EST, 29 October 2010

Ailing outsourcer Mouchel watched its value tumble 30 per cent, after annual losses widened to £14.7million and it scrapped the dividend.

The firm, which provides road maintenance and consultancy for government bodies, has suffered as the coalition has reined in spending.

A restructuring effort to manage the dip in demand has resulted in 2,000 jobs being cut since 2009, costing it £45.2million.

Looking ahead: Mouchel boss Richard Cuthbert said the firm believes that the Government's spending review will boost demand

Mouchel’s woes prompted the board to abandon a final dividend, meaning the full-year shareholder payout will be just 2.25p compared with 6.1p last year. 

The company (down 38p to 87.75p) said it wanted to conserve cash to reduce debt and back bids for new contracts. 

Despite the loss, chief executive Richard Cuthbert still believes government spending cuts would benefit Mouchel in the long term.

And he said Mouchel was in a ‘good position’ to pick up new contracts by taking on some of the ‘more established players’ in the outsourcing industry.