STRUCTURAL steel giant Severfield has seen profits hit after being faced with a £6 million charge relating to a bolt replacement programme for one of London's new skyscrapers.

However the Thirsk headquartered business said the year ending March 31 was a year of "good progress" with underlying pre-tax profits, excluding items such as the bolt replacement charge, more than doubling to £8.3 million.

The business, currently working on Liverpool FC's Anfield stadium redevelopment, reported a fall in turnover to £201.5 million, down from £231.3 million the year before, but attributed the reduction to a new focus on operating margin recovery rather than revenue growth, with a move away from winning work at uneconomic rates or with insufficient allowance for risk.

Severfield said the shift in focus resulted in underlying operating profit increasing by £1.4 million to £9 million, however one-off items meant statutory profit after tax fell to £100,000.

The hardest hitting one-off item was the £6 million Severfield has accounted for in relation to a remedial costs for a programme of works at the Leadenhall building, known as the Cheesegrater in London, where three large bolts fell.

The bolt replacement programme is being undertaken in conjunction with British Land, Laing O'Rourke and Arup, which Severfield said was likely to continue until the end of the calendar year.

The liability of the group and the other parties for the programme costs has not yet been determined and, therefore, the £6 million charge represents certain costs incurred at year-end, together with management's best estimate of the remaining cost to the group.

Severfield chief executive Ian Lawson said: "We are very pleased with the continued good progress made across the business, both in the UK and India, operationally and financially.

"We have a very solid order book and pipeline and our cash flows and balance sheet remain strong.

"Furthermore, our continued investment in our equipment, brand, market position and our people means that we have the skills and capacity to sustain momentum and fulfil demand, securing key projects in growth sectors as the UK, and Indian, infrastructure markets continue to develop."