Balfour Beatty posts 12 percent rise in first-half profits
The UK's largest construction company said it couldn't forecast when a pick up would occur in the UK however
By CFOWorld staff | CFO UK | Published 14:16, 15 August 12
Balfour Beatty on Wednesday posted a 12-percent rise in underlying pre-tax profits for its first six months boosted by a one-time lift from the sale of infrastructure investment assets.
The construction company however said it could not forecast when the UK building market would regain momentum where its own order book was down 3 percent, despite outperforming the market which saw a 10 percent fall.
Underlying first-half pretax profit rose 12 percent to £154 million on revenue up 6 percent to £5.5 billion, the company reported on Wednesday.
Balfour Beatty shares were up 2.1 percent at 200.6 pence at 0920 GMT, valuing the company, which operates in more than 80 countries and built the Olympics Aquatics Centre, at £2.0 billion.
Its order book at the end of June sat at £15.0 billion, helped by £5 billion of new orders in the first half, and compared with £15.2 billion a year earlier.
Balfour Beatty also said its focus in recent months on winning contracts in industries such as transport and mining, particularly in emerging markets, meant it should meet its own full-year expectations.
"We do not anticipate any significant further reduction ... But in terms of recovery of volumes, it is difficult to see, in the very short term, where recovery is coming from," deputy chief executive Andrew McNaughton said.
"The business is on track for where we expect it to be this year," McNaughton told Reuters, adding that while the £52 million gain from the asset sales provided boost, overall trading was in line.
US construction markets appeared to have reached a stable state, Balfour Beatty said, with meaningful recovery still 12 to 18 months away.
The global construction sector has struggled to recover from the financial crisis, weighed down by government spending cuts and recession, particularly in Britain and the US.
The interim dividend was raised 6 percent to 5.6 pence.
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