Construction News

Wed October 28 2020

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Costain cuts pension deficit by £22m with PFI stakes

8 Nov 10 Costain has transferred the value of six PFI assets into its pension pot " which will make substantial inroads into the fund's £56m deficit.

The six PFI investments, in healthcare and education projects, are valued at £22m.

As a result of the transaction, Costain said the profit realised on the PFI assets is £10.5m, and that its profit before tax for the year ending 31 December will be increased by £7.5m.

The firm added that its forward order book now stood at £2.4bn, after securing a number of major contract awards in the third quarter, including:

  • Bond Street station upgrade, in joint venture, for London Underground
  • Severn Trent facility at Frankley in addition to the AMP5 contract
  • A 10-year nuclear framework contract for Magnox South
  • A cable tunnel contract for National Grid

In addition, its is currently preferred bidder on contracts with an aggregate value of more than £400m.

Summarising the outlook, Costain said: “The group welcomes the commitment by the Government in its recent Comprehensive Spending Review, and endorsed in the National Infrastructure Plan, to prioritise £200bn of investment over the next five years in key energy and infrastructure projects, such as Crossrail. 

“Whilst challenging market conditions are set to continue for the foreseeable future, the board expects to report continued progress at the year-end in line with its expectations.” 

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