Bouygues UK has slumped to a third consecutive year of losses, taking its accumulated pre-tax deficit since 2022 to around £136m.

While turnover rose 15% to £376m last year, the contractor continued to struggle with challenging market conditions posting a pre-tax loss of £32m.

This was significantly improved from the £62m loss recorded the previous year and a £42m loss in 2022.

Directors blamed subcontractor failures, labour shortages and ongoing building safety liabilities.

Over the year the French parent group pumped in a further £32m of equity, taking UK net assets to £30m.

The firm booked a further £69m into warranty provisions, lifting the total customer warranty provision to £198m, mainly to cover long-tail safety obligations stretching up to 30 years. Expected insurance recoveries of £49m have been recognised.

Directors said the business would remain selective in its bidding and that economic headwinds would keep pressure on results through 2025.

At the start of the year Bouygues veteran Philippe Bernard, who has 30 years experience at the main group, took over as chief executive of the UK contracting business, replacing Fabienne Viala who stepped down after eight years.

In the accounts, Thibaut Roux, finance director, said: “While the directors expect pressures on reported financial performance to remain during 2025, they believe that the company’s strategy should provide the foundations for improved results in future years.

“The directors will continue to monitor the impact of economic conditions and further developments in relation to Building Safety regulation on the company and take this into account when making future operating decisions.

Headcount fell 4% to 1,830 staff.