Fri, 16 Mar 2018 | ADMINISTRATION
Engineering consultancy company Hydrock has placed its specialist remediation arm QDS Contracting into administration after making the decision to exit contracting.
The move comes just five weeks after Hydrock announced the rebranding of its remediation branch as QDS Contracting, after which the company conducted a review of its business and concluded the subsidiary company was losing too much money to remain sustainable.
Specifically, the administrators revealed the division is facing a number of financial issues related to many unprofitable contract, and as a result it is now seeking offers from potential purchasers.
QDS Contracting, originally Hydrock Contracting, was formed when the company purchased competitor QDS for £450,000 in April 2013. However, the latest figures from the firm reveal that it lost £2.5 million from a revenue of £24 million in 2017, a loss the company is unable to support.
Commenting on the decision to place the division into administration, Hydrock group managing director Dr Brian McConnell stated that it hoped to see greater success in the company's future once it was able to focus all its energy and resources on its core business of multi-disciplinary engineering design and consultancy.
"Remediation contracting work is increasingly high-risk and low-margin due to the number of organisations expanding their reach into what had traditionally been a very specialist and technical sector," he said. "This situation has resulted in work packages proving to be commercially unsustainable in the long term."
The remediation branch of the company was responsible for a number of high-profile projects during its operation, the largest of which was a £40 million site remediation package for EDF at Hinkley Point C.
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