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| Mouchel shares plunge 30% as losses mount | Mouchel shares plunge 30% as losses mount |
| (about 2 hours later) | |
| Shares in outsourcing group Mouchel sunk more than 30% after it reported heavy losses and scrapped its dividend. | |
| Mouchel, exposed to infrastructure spending by councils and government agencies, reported a £14.7m pre-tax loss, on revenues down 15% to £632m. | |
| The company said it "has faced some challenges in recent times" and was restructuring to help reduce costs. | The company said it "has faced some challenges in recent times" and was restructuring to help reduce costs. |
| Shares in Mouchel, which this year rejected a takeover bid worth 294p a share, were 87p in afternoon trading. | |
| Mouchel, whose operations include road maintenance and consultancy to local authorities, has already cut its headcount by more than 2,000 this year. | Mouchel, whose operations include road maintenance and consultancy to local authorities, has already cut its headcount by more than 2,000 this year. |
| The firm is in refinancing talks with its bank lenders, RBS, Lloyds and Barclays. | The firm is in refinancing talks with its bank lenders, RBS, Lloyds and Barclays. |
| Richard Cuthbert, chief executive, said: "Trading in the current year has started more slowly than expected and the immediate outlook remains uncertain." | Richard Cuthbert, chief executive, said: "Trading in the current year has started more slowly than expected and the immediate outlook remains uncertain." |
| But he believes that pressure on the public sector to cut costs will lead to greater demand for private sector support, opening opportunities for partnerships and collaboration. | But he believes that pressure on the public sector to cut costs will lead to greater demand for private sector support, opening opportunities for partnerships and collaboration. |
| Confidence | Confidence |
| Mr Cuthbert said: "There is already evidence of more local authorities looking to outsource services to the private sector as they seek efficiencies, service improvements and reduced costs. | Mr Cuthbert said: "There is already evidence of more local authorities looking to outsource services to the private sector as they seek efficiencies, service improvements and reduced costs. |
| "Mouchel is in a good position to provide support as it has a large number of long-term, large-scale local authority bundled service partnership contracts," he said. | "Mouchel is in a good position to provide support as it has a large number of long-term, large-scale local authority bundled service partnership contracts," he said. |
| Mouchel was already hurt by the collapse of Dubai's property market and has made a costly exit from the emirate to concentrate on fast-growing neighbour Abu Dhabi. | Mouchel was already hurt by the collapse of Dubai's property market and has made a costly exit from the emirate to concentrate on fast-growing neighbour Abu Dhabi. |
| At the start of 2010, Mouchel rejected takeover approaches from VT Group, which was subsequently bought by defence group Babcock. | At the start of 2010, Mouchel rejected takeover approaches from VT Group, which was subsequently bought by defence group Babcock. |