The contract on Bermuda’s new hospital wing has resulted in “substantial losses” for a major UK construction firm, according to The Telegraph.

However, the Bermuda Hospitals Board (BHB) last night responded to that the project remained squarely on budget.

The British newspaper yesterday reported that Sir Robert McAlpine Holdings has reported a pre-tax loss of £37.7m for the financial year ending October 31, 2013 — versus a £19.2m profit reported for the previous year.

The company, which was behind the London 2012 Olympic Stadium, has been left “deep in the red” on the contract for the acute care wing at King Edward VII Memorial Hospital (KEMH).

McAlpine Holdings is described as the umbrella company for the family’s construction portfolio.

Operating profits declined from £17.4m in 2012 to a loss of £40.2m.

Company directors ascribed the fall in takings to the company’s support for the Bermuda-registered BCM McAlpine Limited, which is the main contractor for the project.

“Severe problems” with design and performance caused losses that were covered by a £50m stipend fronted by Sir Robert McAlpine Holdings.

The Telegraph quotes company director Ian McAlpine as saying business was “severely impacted by the difficulties encountered on the King Edward VII redevelopment”.

The construction of the new acute care wing is the Island’s first public-private partnership, between BHB and Paget Health Services.

Paget Health is a consortium of local and international companies, charged with building, financing and maintaining the new hospital wing over the next 30 years. Under the arrangement, cost overruns are to be carried by the contractor, and not by BHB.

According to the UK newspaper, BCM McAlpine has “significant claims” outstanding from the project and owed the holding company £18.8m as of October 31 last year.

The new acute care wing, originally slated for completion in March, is currently projected to be completed by mid-September of this year.

A BHB spokeswoman said the organisation had no comment on The Telegraph’s story, adding: “The new wing is on track to be completed on budget and to the contracted quality standards and specifications. We look forward to opening our doors to the public this September. ”