Balfour boosts profits despite another Aberdeen road hit

Grant Prior 6 years ago
Share

The troubled Aberdeen Western Peripheral Route project lost Balfour Beatty another £23m during the first half of this year.

Group chief executive Leo Quinn said "there is a lot to feel good about"
Group chief executive Leo Quinn said "there is a lot to feel good about"

The contractor confirmed in its half-year results today that the cash outflow on the scheme in 2018 is now forecast to hit £135m.

Balfour became a 50% partner in the scheme with Galliford Try in January when previous joint venture member Carillion went bust.

Problems on the AWPR dented returns at the UK Construction Services division where operating profit for the six months to June 29 was £5m compared to £2m last time.

Excluding the AWPR project the division saw margins rise to 2.1% as Balfour’s Build to Last transformation programme continued to deliver results as the firm maintained its tighter controls over bidding.

Regional construction has reduced the number of live sites to 250 from 400 three years ago.

Balfour said: “During Build to Last, there has also been a shift towards a lower risk contract portfolio, with a reduction in the number of fixed price contracts offset by an increase in target cost (negotiated tender) contracts and framework agreements.”

Group chief executive Leo Quinn said there was a “lot to feel good about” in the results with Balfour hitting its target of returning to industry standard margins across all divisions.

Group pre-tax profits were up to £56m from £22m on turnover down to £3.84bn from £4.19bn.

Average net cash increased during the period to £161m from £45m.

Quinn said that the longer-term target for UK Construction was a margin of 5%.

He said: “There is no doubt that with one less major competitor after Carillion’s failure people are getting more sensible about bidding levels.

“Contractors are getting more risk averse and prices are coming back albeit from a very low level.”

Latest news

Over £600m awarded for decarbonisation projects – full lists

Over 240 public building energy upgrade projects secure cash
3 hours ago

Ridge buys rival consultant Jubb

Acquisition will see 100 new staff join Ridge
13 hours ago

Enabling works to start £130m Huyton town centre regen

Phase one includes a new council HQ, hotel and 72 flats
13 hours ago

Grainger build to rent pipeline rises to £1.4bn

Rental specialist buys sites in Sheffield and Cardiff to build 600 rental homes
13 hours ago

Kier wins Cambridgeshire County council estate upkeep

Firm will provide building and M&E services to 106 buildings across the county
12 hours ago

Louvres and solar shading specialist files for administration

Hampshire based ALPS lodges court notice after 25 years in business
13 hours ago

Speedy Hire posts a loss in latest results

Hire giant confident of better performance in next six months
13 hours ago

Esh to lead next phase of Riverside Sunderland regeneration

Infrastructure work will allow further development of Sheepfolds area
12 hours ago

Green light for £1.3bn Edinburgh coastal town revamp

First phase of Granton Waterfront scheme will see Cruden Homes create a new community
1 day ago

Vistry chief operating officer steps down

Earl Sibley exits as his COO role axed for more direct reporting to CEO
2 days ago

House builder Camstead goes into administration

Work stopped on three current sites
2 days ago

Death of piling legend Roger Bullivant

Industry innovator dies after long illness aged 85
2 days ago

ESS Modular went down owing suppliers £7m

Modular specialist owned by ISG owner Cathexis
2 days ago

Builders back farmers in inheritance tax protest

"A rethink is desperately needed" say National Federation of Builders
2 days ago

Willmott Dixon wins £36m leisure centre upgrade

Work to start on historic Westminster 1930s Grade II listed Seymour Centre
2 days ago

Graham wins £100m Cardiff Crossrail phase 1

Work on route to Cardiff Bay to start before end of next year
3 days ago

Laing O’Rourke appoints new European MD

Peter Lyons to take-up new role in February
3 days ago

Profits dip at Stepnell ahead of demerger

Turnover and secured workloads up ahead of restructure
3 days ago

HS2 green bridge deck takes shape

100m-wide wildlife bridge to carry hedgerows and country lane over HS2
3 days ago

1,000-home Wolverhampton city centre scheme in for planning

ECF and council advance City Centre West build to rent scheme
3 days ago

Sisk clinches £54m North London council HQ revamp

Haringey's iconic Grade II listed civic centre to be brought back into use
3 days ago

Ofgem approves £2.5bn Eastern Green Link 1

Work to start next Spring on cable project from Scotland to the north of England
3 days ago

Anglian Water hunts for £1bn delivery partner

Programme delivery partner wil integrate with client team over 15-year plan
4 days ago

Hadden collapse costs supply chain £6.7m

"Highly unlikely" subcontractors will receive anything for their unpaid invoices
4 days ago

Management buyout at M&E specialist

£25m turnover Kimpton in second MBO in its 60-year history
4 days ago

BAM finalises £71m deal to replace first major RAAC school

Work to start on new St Leonards Catholic School in Durham
4 days ago

Scaffolder hit by two tonne weight at nuclear plant

Court hands out £633,000 in fines after Dungeness B decommissioning incident
4 days ago

Go-ahead for 860,000 sq ft East London medical campus

Whitechapel Road scheme of six new and repurposed buildings
4 days ago

Site labour rates hit record high as cost inflation returns

Industry's biggest payroll firm says rates rose nearly 5% last month in London
7 days ago

Morris & Spottiswood acquires part of ISG fit-out division

ISG Cathedral acquisition saves 111 jobs and expands presence across England
1 week ago

Contractor services