the cost<\/a> of its failed energy from waste (EfW) projects yesterday, which have now far surpassed the \u00a370m provision put aside in May 2016 for a delayed waste to energy contract in Glasgow for Viridor.<\/p>\nInterserve was also served a notice of termination on another project with waste gasification specialist Energos after the firm went into administration in July.<\/p>\n
After problems with contracts pushed Interserve into a \u00a334m half-year lost it then announced it would quit the EfW sector.<\/p>\n
But costs associated with exiting contracts has hit the firm for an additional \u00a390m, taking total costs to \u00a3160m.<\/p>\n
Rising costs<\/h3>\n
In a statement, Interserve said: \u201cAlongside this exercise we have continued to undertake a detailed review of operational developments on the other contracts in our exited EfW business, including the impact of the entering into administration by our principal gasification subcontractor, Energos, together with the likelihood and timing of potential recoveries and claims from third parties.<\/p>\n
\u201cIn the light of these developments and of the continuing uncertainties in relation to the final conclusion of our EfW contracts, the Board has concluded that the exceptional provision of \u00a370m announced in May 2016 is no longer adequate to reflect the incurred and anticipated losses associated with this business.<\/p>\n
\u201cConsequently the Board has determined that it is appropriate to increase the exceptional provision for exiting this market and the associated contracts to \u00a3160m.<\/p>\n
\u201cWe expect to complete substantially the construction and commissioning of the projects during 2017, although our contractual obligations in respect of warranties, and the resolution of claims will continue for a period thereafter.<\/p>\n
\u201cFurther cash outflows of c\u00a360m are expected during 2017 as the income statement charge is utilised.\u201d<\/p>\n
\n<\/div>","protected":false},"excerpt":{"rendered":"
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