Construction BUSINESS

Balfour Beatty has announced its half-year results for the half-year ended 30 June 2017.

Financial Highlights

• Underlying profit from operations (PFO) £39m (2016: £11m); on track for full-year expectations
• Half-year net cash £161m, average net cash £45m – without material investment disposals
• Underlying revenue £4.2bn, up 8% (1% at CER)
• Directors’ valuation of Investments portfolio up 1% at £1.235bn
• Interim dividend payment up 33% to 1.2 pence per share

Operational Highlights

• Build to Last Phase Two targets: on track for industry-standard margins in the second half of 2018
• Continued to simplify and focus the Group; exited Middle East
• Order book £11.4bn, down 8% (6% at CER); selective bidding delivering higher margins and reduced risk
• Balfour Beatty VINCI joint venture awarded two HS2 contracts in July, valued at c.£2.5bn
• Strong pipeline for US and UK businesses

Leo Quinn, Group Chief Executive, commented: “These results demonstrate the transformation being driven by focusing Balfour Beatty relentlessly on its chosen markets and capabilities. Profitability is rising, backed by positive cash flow from operations, and the Group had average net cash during the period; all achieved without any material investment disposals. The balance sheet remains strong, underpinned by the £1.2 billion Investments portfolio.

“Under stronger leadership and much improved bidding disciplines, the businesses are booking new orders at improved margins and reduced risk. Our infrastructure pipeline in the US and UK remains buoyant and the Group continues to win landmark contracts such as the Dallas Southern Gateway and HS2.

“All of this gives us confidence that the Group remains on track to achieve industry-standard margins in the second half of 2018, and in line with this, we are declaring an interim dividend of 1.2 pence per share.”