Housing contractor Mears feels ripple effect of Grenfell Tower fire

UK housing and social care contractor Mears saw its shares plunge on Tuesday (15 August) after it warned revenues and profits will be hit as a result of the Grenfell Tower fire in London.

While the company had no involvement with the Grenfell tragedy in June, it said the ripple effect would result in delays to plans for work orders.

The timing of planned workloads is likely to be off as social housing clients' attentions were being diverted towards making sure their housing portfolios were safe and fully compliant, Mears noted in a statement.

This would cut the revenue it had expected to make this year from housing by £30m to £800m. Additionally, the company's half-year profits were flat at £12.7m.

Following the statement, Mears shares fell by nearly 11%, before mounting a marginal recovery. At 12:45pm BST, the company's shares were 5.96% or 28.48p lower at 449.45p.

David Miles, chief executive of Mears, said: "Whilst the likely revenue shortfall for the full-year is frustrating, it is entirely understandable in the circumstances and the group will be working closely with its partners and clients at this time to address their immediate priorities."

However, Miles reiterated that Mears' order book remained strong and expressed confidence in its future prospects.