Balfour Beatty announces good construction margins in the UK

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General Manager Leo Quinn

In a trading update ahead of its annual general meeting today, Balfour Beatty said global trading was in line with expectations so far this year.

The order book stood at £15.6bn at the end of March, down £500m from three months earlier.

In the first four months of 2022, the average monthly closing net cash balance has increased to around £800m, although the monthly average for the full year is a bit lower than this – but up from compared to the 2021 monthly average of £671m.

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Within Construction Services, operating performance is in line with expectations despite some ongoing Covid-19 related restrictions in Hong Kong. US Construction is expected to deliver a 1-2% margin for the full year of 2022. UK Construction remains on track to deliver industry standard margins of 2-3% for the full year 2022, said board of directors.

Support Services is in line with the 6-8% margin target, albeit on a lower revenue base after exiting the gas and water business. The rail industry recently agreed a £120 million work program for Network Rail as part of the Central Rail Systems Alliance’s ten-year track renewal programme.

Group Chief Executive Leo Quinn said: “We remain confident that the Group is well positioned for 2022 and beyond. Our business portfolio has been transformed to focus on the growing infrastructure markets of the UK, US and Hong Kong, each backed by strong government investment programs. The strength of our balance sheet and the better quality of our order book will allow us to maximize these opportunities for profitable growth while remaining resilient to the current macro-economic challenges.

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