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Dive brief:
- following boost promises during its 2024 half-year results call, London builder Balfour Beatty said it expects to grow its portfolio and revenue in a December 5 Commercial Update.
- Balfour Beatty expects its backlog, or backlog, to grow more than 5% in 2024 from the 16.5 billion pounds ($21 billion) it reported at the end of 2023. The company also expects a revenue growth of approximately 2% from 9.6 in 2023. billion pounds.
- The company also said profits from operations should be higher than its 2023 figure of £236m. It projects profits from its construction services division to be in line with 2023 results of £156m and said improved profits in its UK construction segment would be offset by lower construction profitability in the USA
Diving knowledge:
In the UK, the company continues to work on two major projects: HS2a high-speed rail line that will cut across the country, and Hinkley Point Ca nuclear power plant in Somerset, a county in the south-west of England. The facility, the first new nuclear power plant to be built in the country in the last 30 years, has just installed its first reactor, according to the BBC.
The government’s commitment to invest in infrastructure to support economic growth is encouraging for Balfour Beatty in the medium term, according to the press release, with its growth areas of energy, transport and defense included in broad plans investment
In the United States, however, Balfour Beatty has had problems. While it said its buildings business performed robustly, costs from delays in the second half of the year on a handful of projects weighed on the segment’s profitability, the update said. The company did not immediately respond to Construction Dive’s request for more information about the delayed projects.
Despite the headwind, the US order book is expected to grow by more than 10% in 2024, up from £5.7 billion in 2023, due to a strong second half of order intake from both in their buildings as for their civil business. Its US building segment reserved:
- 600 million dollars in the hospitality sector.
- $500 million of federal/state work.
- $400 million for commercial office jobs.
- $350 million for education contracts.
“In 2024, the group has once again shown the benefit of the geographical and operational diversity of our portfolio, delivering an encouraging overall performance,” Balfour Beatty CEO Leo Quinn said in the press release. “As a result, we are on track to increase earnings in 2024.”
