ISG is continuing to experience problems with its construction division, it has been revealed.

The business is set to make a loss this year and take £5 million off overall group results.

ISG's CEO David Lawther said despite the disappointing results, other divisions such as its Fit Out and Engineering Services businesses performed strongly.

"We continue to work on the recovery plan for UK Construction," he said.

"Despite the many positive steps we have taken, we have continued to experience disappointing project outcomes on some older contracts.

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"In addition, with margin and risk control remaining our priority rather than volume and some customers delaying the start on site of their projects, volumes this year will be below our expectations with profit deferred to later periods.

"As a consequence, this division will be loss making this year and will impact the Group results by up to £5m.

"The Board is resolute in its ambition to refocus this division on core sectors, regions and skills."

In September, ISG reported a June year-end loss of nearly £28m following a restructure of its construction division.

Mr Lawther added: "Work on closing out the final projects on discontinued activities is proceeding in line with our expectations.

"We expect all projects to have reached practical completion by December 2015 and for the vast majority of outstanding commercial issues to have been settled by the financial year end."

(LM/CD)