Mears is set to write off £8m from its former M&E division, Haydon.
According to Construction News, in a trading update to the City covering the period from 1 January to 17 November 2015, Mears said its original expectation was that the group would “experience a cash in-flow… which, up to Decemer 2014, had been the case”.
However, the group said it had now “reassessed” this amount and will write off around £8m, including a cash out-flow of around £4m.
The social housing specialist sold its M&E arm Haydon to its management for £1 in November 2013.
The group also said it had further extended its services in housing management, with more than 4,000 homes now under management across the country.
The firm cited “the ongoing shortage of social housing” as the prime driver for this growth.
Earlier in the year, Mears chief executive David Miles (pictured) said the management sector was “highly fragmented and underdeveloped”, and that the group would be specifically targetting that sector during 2015.
The group’s social housing division has also secured around £300m of new contract wins, with its win rate on competitively tendered works standing at 33 per cent for the year to date.
Contracts won in the year included a £12m deal for asset management housing repairs for Greenwich Borough Council, and a £50m contract to purchase and refurbish 400 private homes with an unnamed London borough.
The group is also in the process of finalising a partnership deal with Milton Keynes Council, although this has not yet been reflected in the firm’s order book.
Mears said trading in its care business continued to be “challenging”.