The considerable operational improvements at Fulcrum Utility Services (FCRM), a specialist in unregulated utility connection services, have been somewhat overshadowed by tough conditions in the housing development and commercial construction markets. News of slower order flow prompted a 17 per cent markdown in the shares after the results as well as earnings downgrades.
Fulcrum's problem is that about half of its sales are generated by small enterprises, which are with-holding spending or are unable to finance projects. However, there is a compensating shift in the sales mix, with projects valued over £100,000 growing by 60 per cent, offsetting the 16 per cent fall in lower-value work. Unfortunately, that has made revenues lumpier and procurement times longer, which explains why the timetable for work is now being pushed back into next year.