The company’s UK construction operation reported an underlying profit of £5m for the half-year ended 29 June 2018, up from £2m in 2017, after an underlying charge of £15m for the Aberdeen Western Peripheral Route (AWPR) which experienced “schedule slippage and cost increases”.
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Part of the AWPR is already open to the public, with the majority of the route scheduled to open by the end of August. Completion of the one remaining bridge is expected in the autumn.
Balfour Beatty said it was “encouraging to note” that excluding AWPR, UK construction reported an operating profit of £20m, representing a margin of 2.1%.
At a group level, Balfour Beatty saw an 8.6% decline in total revenue for the half-year in 2018 to £3.84bn, down from £4.2bn in the same period a year before.
However, pre-tax profit rose strongly, increasing to £50m for the half-year 2018, up from £12m the year before.
The company’s order book at the period end stood at £12.6bn. It does not yet include the estimated £2.5bn value of lots N1 and N2 of the UK’s new high-speed railway HS2, on which Balfour Beatty is working in joint venture with Vinci.
Net cash at half-year increased to £366m, with average net cash for the first six months at £161. The group now expects to deliver average net cash for 2018 of £140m to £170m, up from the previous range of £120 to £150m.
Leo Quinn, group chief executive, said: “All our businesses are now either achieving industry standard margins or on track to do so in the second half. The disciplines installed under Build to Last are also enabling us to increase the order book with key infrastructure projects to translate Balfour Beatty’s expert capabilities into future profitable growth.”
