Key facts
- Balfour Beatty increased its earnings and cash flow targets.
- The company's order book grew 17% to £22.9bn in the six months to June.
- Revenue increased 8% to £5.6bn, supported by US housebuilding and the UK power industry.
- Underlying profit rose 42% to £153m.
- The firm's net cash forecast upper limit was raised to £1.7bn.
Balfour Beatty has raised its earnings and cash flow targets, signaling strong performance that contrasts with the difficulties faced by the wider construction sector. The company reported a 17% increase in its order book to £22.9bn and an 8% rise in revenue to £5.6bn for the six months ending June.
This growth was attributed to increased demand in US housebuilding and the UK's energy sector. Balfour Beatty's underlying profit saw a 42% increase to £153m, although headline pre-tax profit experienced a slight 2% decrease to £129m. The firm's chief executive, Phillip Hoare, expressed confidence, stating the company has "real momentum."
The company's success is partly due to its focus on government-backed infrastructure projects in areas such as energy, defence, and transport, which are less susceptible to the cost increases and falling private-sector demand affecting other construction firms. Major contracts secured include a £325m power transmission project in Scotland and $350m in US data centre orders.
Analysts from Peel Hunt noted the company's strong performance and revenue visibility, while Freetrade analyst Alex Pugh highlighted Balfour Beatty's strategic positioning in essential infrastructure and its robust balance sheet.