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Dive brief:
- London builder Balfour Beatty now predicts it will they slightly exceed their entire year The portfolio figures issued in August, with revenue up around 5% from 2022, the company announced in a year-end trading update on 7 December.
- The company predicts its backlog, or backlog, will be “marginally higher” than the 16.4 billion pounds ($20.7 billion) mark it announced in its Call for August half-year earnings. It also forecasts a 5% year-on-year rise in revenue to £8.9bn in the 2022 financial year, driven by higher volumes from Phase 1 of the UK’s HS2 rail project and increased major activity from airport construction in Hong Kong, according to the statement. . By mid-year, the company had said it was still on track to meet its full-year targets and that its growing backlog gave the company confidence over the long term.
- Balfour Beatty’s announcement comes after its weak half-year earnings, where it reported that its pre-tax profit fell to £82m from £83m the previous year. In addition, the builder said its North American segment took a hit due to weakness in the office and technology sectors in Texas and the Northwest, respectively.
Diving knowledge:
The international contractor said its US construction segment saw stronger order intake in the second half of the year compared to the first. The earnings reflected two commercial real estate projects in Texas totaling $800 million, which the company converted from awarded to contracted, along with $300 million of additional federal work in Washington, DC.
For the UK, the contractor noted that HS2 activities at Area North and Old Oak Common are still on track, and that its order book was not affected by the UK government’s decision to cancel the Phase 2 of the megaproject, which had not been done. contracted at this point.
The contractor has also been making gains in its UK support services vertical. It signed a £330 million, six-year extension to a motorway maintenance contract with Lincolnshire County Council. In addition, its rail business was awarded a £43m contract to deliver essential upgrade work on London Underground’s Piccadilly line in October, the statement said.
The company plans to continue this program in January and will confirm the amount of its 2024 share purchase plan next March.
Balfour Beatty has achieved several notable wins over the past six months, including one $62 million highway project in Texas and a potential $500 million Goldman Sachs office complex in Dallas
However, the company has also been mired in controversy: The contractor, as part of a JV that worked on Boston’s $2.3 billion Green Line megaproject, must repair two thirds of the rails because they were placed too narrowly. The The EEOC also sued Balfour Beatty in federal court in September for allegedly allowing the men to sexually harass a woman working as a truck driver on a highway project.
