Interserve axes divi as it dives to £100m loss

Interserve swung to a loss of almost £100 million and suspended the dividend earlier as the outsourcer — which works in UK prisons, hospitals and schools — revealed more damage from getting its sums wrong.

Shares in the business slumped 25% last week after it drastically underestimated the cost of its failed energy-from-waste project and wrote down £160 million.

On Tuesday the firm, which has 80,000 employees who build schools, dress ex-offenders for job interviews, and maintain Oxford University’s labs, revealed a £94.1 million pre-tax loss for 2016, down from a £79.5 million profit a year earlier.

Chief executive Adrian Ringrose flagged up “the increased uncertainty after the UK’s EU referendum” as well as the energy-from-waste fiasco, and said: “We have taken the difficult decision to suspend the dividend.”

The stock fell 2.2p at 234.5p in response.

Ringrose said late last year that he will leave once a successor is found, after 13 years at the helm.

Like other support services firms, Interserve reckons long-term Brexit could lead to more “opportunities as clients look to solutions such as outsourcing to capture efficiency gains”.