The tragedy at Grenfell Tower understandably thrust fire safety into the spotlight, leading many property owners to review their safety standards and regulatory compliance. This led housing maintenance group Mears (MER) to cut its forecasts for revenues in 2017 in August. This week it warned of “further softening”, prompting a 9 per cent drop in the shares on the day of the announcement. It had recovered a small amount of ground at the time of going to press.
However, while the housing division – traditionally the stronger part of the group – has suffered, its long-troubled care division looks to be turning a corner. Management is expecting a profit in the business in the second half of this year, and for the full year overall.
The mechanical and electrical division, which the group disposed of in 2013, is continuing to cause trouble. The division failed to meet some of its performance guarantees, triggering contingent liabilities and requiring an exceptional charge of £16.5m in 2017.
