Willmott Dixon has announced a significant financial rebound in 2024, successfully recovering more than £20 million from third-party contractors to cover legacy cladding remediation costs.

The recovery, which comes amid ongoing efforts across the construction sector to address unsafe cladding installed prior to the post-Grenfell regulatory reforms, contributed to a strong financial performance for the privately-owned company.

In an update covering its full-year results to 31 December 2024, Willmott Dixon disclosed pre-tax profits of £28.6 million—marking a major turnaround from the previous year, where the company reported a £14.4 million loss.

A company spokesperson explained: “Prior losses partly owed to the significant provisions made for legacy cladding remediation works.”

The firm confirmed that it had secured substantial compensation: “The company secured net recoveries from third parties of over £20.0m against those historic provisions during the year, with this exceptional additional income taking 2024’s total profit before tax and goodwill amortisation to £48.8m.”

The remediation recoveries come as part of broader legal action launched by Willmott Dixon in early 2023. The company sought £47 million in damages from five firms linked to the £250 million Woolwich Central development in London, alleging serious flaws in design and construction. While the legal proceedings are ongoing, Building Magazine reported that a portion of the recovered funds may be tied to this high-profile case.

This successful recovery strategy aligns with Willmott Dixon's broader financial stability. The group maintained a steady revenue of £1.2 billion over the year. Management credited this to a refined project delivery model, stating: “The positioning of projects as design-complete and procurement-ready before work starts on site is already proving successful in delivering more consistent and predictable project margins.”

Cladding remediation has been a critical issue across the UK construction industry following heightened scrutiny of building safety standards. Willmott Dixon’s ability to reclaim substantial costs marks a rare financial win in a space where many developers are still grappling with mounting liabilities.

Industry observers see this development as a sign that construction firms may increasingly pursue aggressive legal action against suppliers and designers involved in historic projects. Willmott Dixon’s case could also set a precedent for similar claims by others seeking redress for defective works.

Despite ongoing disputes such as that involving Woolwich Central, the company’s financial update suggests a firm footing going forward. It also reflects a broader shift toward risk management and early design validation across its portfolio.

Originally reported by EPA Media in The FPA.