In the run-up to the London Olympics, Balfour Beatty worked on numerous large public landmark projects including the Olympic Aquatics Centre, the A3 Hindhead dual carriageway and M25 motorway improvements. With these projects all complete on time and budget ahead of the Games , the contractor is now having to look to smaller projects.
The company said in its interim results statement this morning: “In the 'post-Olympics' world, the UK business has been focusing on replenishing the order book with more varied, smaller, often private sector projects.”
As a result, Balfour Beatty’s UK orders have shrunk 3% and revenues by 2% in the first half of 2012.
Globally, £5bn of new orders booked kept the order book broadly stable at £15.0bn, down £200m during the period, but group revenue was up 7% to £4,825m.
Including JVs and associates, revenue climbed 6% to £5,535m for the six months to 30 June 2012.
Reported pre-tax profit from continuing operations was up 2% to £93m
Thanks to the sale of two infrastructure investment assets, underlying profit from continuing operations increased by 15%.
Margins were up in professional services, from 4.5% to 5%, but remained under pressure construction services, falling from 2.0% to 1.5%.
First half results include £14m of restructuring costs as including £9m in UK construction services £9m, where six business units are being combined into three to cut overheads.