Balfour Beatty’s group revenue fell 2% and pre-tax profit fell 9% in the first half of 2011, compared with the first half of 2010, the group reported today.
Group revenue fell from £4.6bn last year to £4.5bn this year, and pre-tax profit decreased from £100M last year to £91M this year.
However, the group said it had incurred £47M of exceptional expenditure in the period, meaning underlying pre-tax profit was healthier and saw a rise of 4% from £133M in 2010 to £138M in 2011.
Exceptional items included a £7M loss on the disposal of the UK specialist rail manufacturing business and £4M of “post-acquisition integration, reorganisation and other costs”, and “acquisition related expenses”. In June, the group acquired US contractor Howard S. Wright in an attempt to capitalise on the US west coast, which it sees as “a significant growth market that is emerging from the downturn”.
Balfour Beatty reported today that its construction profits were 15% lower in the first half of 2011 compared with the same period last year − despite a 7% rise in orders. Construction orders grew from £8.5bn to £9.1bn, but construction profits fell from £79M to £67M.
Professional services fared worse, with orders dipping 2% and profits sinking 22% from £49M to £38M.
Balfour Beatty said: “the impact of the reduction in government spending is evident in UK infrastructure markets and consequently in our UK order book.”