Sluggish economy and rising tax bill send Make’s numbers into reverse

The economy taking longer to recover than expected blunted revenue at Make as increased administration costs sent the firm tumbling into the red, the architect has said in its latest report and accounts.

The practice behind the stalled scheme to redevelop the former ITV Studios headquarters on London’s South Bank, a legal challenge on which is due to be heard next week, said it had been expecting a good year in 2023.

But it said a sluggish economy and delays on planning decisions held up key projects which meant income fell 5% to £18.3m.

And it slumped to a £1.5m pre-tax loss from a £40,000 profit last time after rising administration costs at its Australia and Hong Kong businesses. It added that its tax bill on its cash reserves went up as a result of rising interest rates with cash in the bank falling from £6.3m to £4m.

The losses prompted the firm to embark on a cost-cutting drive towards the end of last year, which according to the accounts included asking staff to consider sabbaticals or reduce their hours.

This was followed by a major restructure in early 2024 which has since seen the firm cut its staff by 20%, from 165 it employed at the end of 2023 to around 132.

It has also finalised the closure of its Beijing business, which has had no employees since 2016.

The results cap a four year run of dwindling profits for Make, which posted a pre-tax profit of around £450,000 in 2020 before this fell to £75,000 the following year.

In a statement included in its latest accounts for the year to 31 December 2023, the firm blamed the results on an economy which “took longer to recover than expected” and planning decisions which “held up a number of key projects”.

Make’s scheme to redevelop the former ITV studios building on London’s South Bank was first called in in August 2022 and was finally given the green light earlier this year by former communities secretary Michael Gove.

But in the summer campaigners won a judicial review into the controversial 26-storey office scheme, one of the biggest construction projects in the capital.

The hearing is scheduled for next Tuesday and Wednesday with a decision expected in November.

The accounts also said that the cost of job losses this year will be reflected in its 2024 accounts. 

Turnover in its biggest region, the UK, was flat at £13.8m but income from Europe fell to just £52,500 from £288,000 while business in Asia was down 20% to £2.7m.