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That was the word that Leo Quinn, chief executive of London-based construction giant Balfour Beatty, said should be one of the first in his mind when assessing his company’s performance.
“What we’re seeing is real momentum in terms of earnings growth, in terms of reserve growth and in terms of shareholder returns,” Quinn told investors during the company’s first half results call on August 14. This upturn comes after its pre-tax profits fell last year during half a year i results for the whole year.
In the first half of 2024, Balfour Beatty reported an increase in annual pre-tax profit to 112 million pounds ($144 million), a 36% increase from the first half of 2023 of 82 million of pounds
The company also said its revenue grew to £4.7bn, up 3% from £4.5bn in 2023. Backlog also rose to £16.6bn, up slightly from £16.5bn of the previous year.
Philip Harrison, the company’s chief financial officer, noted that operating profit in the US construction segment fell from £21m to £18m year-on-year, a 14% decline. The company predicted the fall in its year-end update in Decemberand Harrison blamed the decline on a small number of projects in his civil portfolio that were hit by delays.
“As you know, the risk profile of civil work in the US is higher than that of buildings, and so we continue to focus on a narrower scope of civil projects that we believe can deliver attractive and sustainable returns,” he said. Harrison said.
In the United States, Balfour Beatty’s recent projects include:
UK electricity infrastructure
Over the next decade, Quinn said the company is keeping a very close eye on energy infrastructure in the UK.
Quinn noted that Britain’s Labor Party, which won control of the UK Parliament after the country’s July election, is looking at economic growth through the energy infrastructure pipeline.
“The fact is, low-cost energy will power the next industrial revolution, whether it’s data centers or AI,” Quinn said.
Quinn said the company has the largest power, power transmission and cabling resource in the UK, along with what he called “significant activity” with both National Grid and SSEN, two UK power companies.
Mr Quinn said Balfour Beatty was in a first contractor share agreement with SSEN for £1bn worth of transmission work in Scotland and the Isle of Skye. Another £1 billion of work could come from jobs in Inveraray to Peterhead, two towns on opposite sides of Scotland.
In the future, Quinn also referenced a National Grid study called “Beyond 2030” which predicted that £58bn of work would be needed to prepare the UK for growing and decarbonising electricity demand by the end of the decade.
“And if you think it’s interesting, when you get to 2030 and 2035, it’s going to be the Wild West,” Quinn said. “The amount of stuff that’s going on is going to be mind-blowing.”
