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Severfield sank to a near 拢18m loss last year as the country鈥檚 biggest steelwork contractor said the cost of fixing a dozen bridges will top 拢40m.

The work relates to repairing welding defects on several bridges including structures on HS2.

It said the estimated cost of sorting out the problems will be 拢43.4m although insurance recoveries of 拢20m, due to be received in the first half of the current financial year, have brought the hit down to 拢23.4m. Severfield also said the problems meant it spent 拢1.5m on legal costs.

It added that it had been hit with separate bridge related costs of 拢9m 鈥渋ncluding a reversal of revenue for certain variation orders, following delays in payment and increased uncertainty over their recoverability鈥�.

The firm began a cost-cutting drive in March which has seen around 6% of its workforce go 鈥� the equivalent of 115 jobs 鈥� which Severfield said would cost it 拢1.3m.

This figure also includes the severance paid to former chief executive Alan Dunsmore who went at the end of last month.

Dunsmore, who is mentioned only once in this morning鈥檚 results, spent 15 years at the firm, taking the top role in 2018, before Severfield said he would be leaving in March.

Severfield gave no update on his successor with the results being presented by non-executive chairman Charlie Cornish.

Severfield said its dispute with HMRC on a 拢4.4m tax bill, in a case which centred on whether site staff working away from home should be taxed on accommodation and subsistence, had been settled with its liability reduced to 拢3m.

The firm has suspended its final dividend for the year and added that it has agreed an option with JSW Steel, its partner in the Indian joint venture JSSL, to buy up to 24.9% of JSSL for up to 拢20m before 31 March next year 鈥� although it said there was 鈥渘o current intention鈥� to do so.

Revenue at the business in the year to 29 March was down 3% to 拢451m with the firm racking up a 拢17.5m pre-tax loss from a 拢23m profit last time.

The firm said its order book on 1 July was 拢444m, up from 拢410m at the start of November last year, with its current jobs including a battery plant in Sunderland being built by Wates. It is also set to start work on a new battery plant in Somerset, due to be built by Sir Robert McAlpine, although this has been delayed by several months.