Perthshire’s largest contractor succumbs to inflation challenges, marking a significant shift in local construction dynamics. The collapse of Hadden Construction, based in Aberuthven, has prompted widespread concern, with 66 workers facing redundancy.
- Hadden Construction has entered administration due to insurmountable inflation-related costs.
- All construction activities have halted, affecting several ongoing projects.
- Administrators plan an orderly wind-down of the company’s operations.
- Uncertainty surrounds the future of Hadden Construction Holdings Ltd.
The largest contractor in Perthshire, Hadden Construction, has announced that it has entered administration, marking a significant disruption in the region’s construction industry. This comes in the wake of persistent inflation-related challenges that have severely impacted the firm, particularly the soaring costs of materials and labour. As a result, 66 employees have been made redundant, highlighting the substantial human cost of the economic pressures that Hadden faced.
In a statement released on their website on 10 September, the company detailed that all work on its construction sites has ceased. The decision to enter administration was influenced by multiple headwinds, including supply chain interruptions that exacerbated their financial difficulties. The firm had only recently reported a pre-tax profit of £230,000 on a £30.2 million turnover for the financial year ending 31 March 2023, signalling a brief period of recovery post-Covid before succumbing to these persistent economic strains.
The appointed administrators, Ben Cairns and Jonny Marston from Alvarez & Marsal, have expressed their commitment to managing an orderly wind-down of operations. Cairns noted the adverse impact of high inflation on Hadden’s business model, which had relied heavily on framework projects and two-stage tendering to secure more favourable terms. Despite these efforts, the firm could not withstand the continued inflationary pressures and programme slippage attributed to pandemic aftershocks.
During its operational years, Hadden Construction was involved in diverse projects, from RAAC remediation to prestigious developments like the £4 million student accommodation refurbishment for the University of Stirling and a £6 million traveller accommodation scheme near Perth. The firm also secured prominent positions on significant frameworks, such as the Scottish Procurement Alliance’s £100 million refurbishment and modernisation framework.
Despite Hadden Construction’s current troubles, its parent company, Hadden Construction Holdings Ltd, continues to trade, according to the Companies House website. The situation remains fluid, with future outcomes for the parent company still uncertain.
The collapse of Hadden Construction underscores the severe impact of inflation on the construction sector.
