Modular builder TopHat consults on 70 job cuts
Volumetric builder TopHat has launched a consultation over 70 potential job cuts, Construction News understands.
The Derby-based firm blamed a "challenging market" for the cost-cutting measures. It comes as the UK has seen a sharp fall in housebuilding, partially caused by an increase in interest rates.
A TopHat spokesperson said: "TopHat is consulting with employees as part of a programme to reduce the costs of the business in response to the prevailing challenging market.
"The changes are a prudent step to ensure the business maintains current delivery levels during 2024 and is well positioned for growth as the market returns.
"The medium and long-term need for volumetric modular homes is becoming ever clearer as traditional build capacity is constrained by the growing skills shortage.
"While cost cutting is always tough, these changes will put TopHat in pole position for growth when demand rebounds."
Several TopHat employees have posted on LinkedIn in recent weeks that they are looking for new roles.
The firm posted a £5.1m pre-tax loss in its latest set of accounts, covering the year ending October 2022. It said that it was "not yet profitable or cash generative" because of its "investment in future growth and innovation".
At this time, the firm reported that it had an average of 212 employees during the previous year.
TopHat agreed a £15m debt facility with Homes England in November, and raised £70m from investors including Persimmon, Aviva and Goldman Sachs in its latest funding round last April.
The housebuilder is planning to open a second factory to manufacture modules later this year. It claims the 60,000 square metre facility in Corby, Northamptonshire, will create 1,000 jobs.
However, TopHat's redundancy consultation is the latest in a string of troubles for the modern methods of construction (MMC) sector.
Laing O'Rourke cut 60 jobs at its offsite factory in Nottinghamshire in January, while other modular ventures such as Ilke Homes and L&G are now defunct.
TopHat chair Carl Leaver highlighted strategic and operational weaknesses in the business strategies of the latter duo in his evidence last October to the House of Lords MMC inquiry.
Leaver later wrote a letter to the inquiry before its report was published, rejecting claims made by one witness that volumetric housing is more costly to build.
Original source: Modular builder TopHat consults on 70 job cuts | Construction News
