Engineering contractor Van Elle is anticipating a slight decline in revenue this year due to a number of contract delays.

In a trading update today, 22 March, the piling specialist said it expects full-year revenue to sit a around £93 million, a 5% decrease below previous expectations.

The company stated: "As indicated at the time of the Company's interim results on 19 January 2017, there were a number of contracts within the Specialist Piling division expected to be confirmed and commenced in the second half, particularly in the division's on-track rail business.

"The Company now anticipates the start date for several of these contracts will be delayed beyond the end of the current financial year and, in a small number of cases, the expected call-off schedule and distribution of work packages may be revised.

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"Whilst Van Elle still expects to deliver a number of these contracts on revised time schedules, the Group will not receive the previously expected contribution from them in the current financial year.

"As a result, the Board now expects to deliver full year revenue of approximately £93 million, some five per cent. below its previous expectations, with the Group's underlying operating margin slightly reduced as a result of the adverse mix impact."

"Looking ahead, Van Elle continues to be optimistic about the long term opportunity within its rail business, given the ongoing need for maintenance of the UK track network as well as significant capital programmes such as track-bed stabilisation and the electrification of major routes. However, the delay and deferral of contracts in the fourth quarter is disappointing and creates some uncertainty around this market in the near term.

"In light of this, the Board believes that it would be prudent to assume only a modest increase in the level of rail activity, and growth in the Specialist Piling division as a whole, in the coming year until visibility over a number of programmes becomes clearer."

(LM)