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Mitie doubles profit but warns on living wage changes

The company saw pre-tax profit increase by 133 per cent to £96.8m for the year to 31 March 2016, up from £41.5m the year before.

But the firm said it had seen “a number of its clients” delay or cancel projects until after the EU referendum.

Upcoming changes to the minimum wage and living wage initiatives could also have an impact on its business, the company said.

It added that government initiatives would lead to  “significant increases to the cost of employing people, especially people on lower incomes”.

“While some clients are able to afford and pass on any increases, many are not able to do so.

“In these instances we work with them to identify changes to either the quantity or scope of services that we provide.”

Group revenue stood at at £2.23bn, down from the £2.27bn reported in its previous results.

Hard FM services accounted for £618.4m (£621.1m: 2015) of total group revenue, and £31.7m (£31.4m:2015) of group operating profit.

Key wins for the division included a £100m, five-year M&E contract with NHS Property Services and a new contract to provide hard FM services to Red Bull Racing in Milton Keynes.

Mitie said profit in hard FM had been “negatively affected [by] a smaller proportion of revenues generated by higher-margin variable project works”.

Overall, the group’s facilities management arm reported an order book of £7.2bn, down by 5.3 per cent, from £7.6bn the year before.

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BDC 314 : Mar 2024