Revenues rise at Balfour Beatty
By Helen Wright16 August 2012
Balfour Beatty has reported solid results for the first half of 2012, despite continuing pressure on volume and margins in its construction services division.
The UK-based contractor said group revenues were up 7% year-on-year during the first six months of 2012 to £4.8 billion (€6.2 billion), while gross profit also increased 7% to £95 million (€122 million).
The company's professional services, infrastructure investments and support services divisions helped offset a weaker performance in the construction services unit, where operating profit fell 21% year-on-year to £53 million (€68 million).
Balfour Beatty said its UK construction order book and revenues declined 3% and 2% respectively in the first half, in a marketplace that it said had continued to shrink. In the US, the construction services division reported an 8% decline in orders but a 10% increase in revenues.
The company said the US construction markets appeared to have reached a state of stability, but a meaningful recovery was still forecast to be 12 to 18 months away and dependent on the availability of federal and private financing.
However, overall revenue in the construction services division grew 7% year-on-year to £3.5 billion (€4.5 billion), boosted by growth at Gammon, Balfour Beatty's joint venture in Hong Kong.
Meanwhile, with £5 billion (€6.4 billion) of new orders in the first half, the contractor's group order book was stable year-on-year at £15 billion (€19 billion).
Balfour Beatty chief executive Ian Tyler said the results came in a challenging market. "We remain on track to meet our expectations for the full year and are making good progress on the early stages of our growth strategy in key industry verticals," he said.