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Balfour's revenue drops

Balfour Beatty’s revenue fell in the first half of this year, it revealed this morning.

The UK’s largest contractor posted overall income of £4.85bn for the six months to 27 June 2014. This was down from £4.96bn in the same period last year.

However it did make a pre-tax profit of £1M, having made a £4M loss in the first half of last year.

Balfour’s UK construction services revenue fell 7%, dragging back a more positive performance elsewhere in the world.

The global division made a £69M loss from continuing operations, down from a £39M loss in the same period the prior year.

It said this loss was largely due to operational issues in the UK engineering services department, and to a lesser extent the UK major projects arm.

Balfour confirmed its planned sale of US consultant Parsons Brinckerhoff was proceeding in line with expectations. A third round of bids is imminent, it said.

The contractor added that the sale of Parsons was at the heart of its rejection of a second attempt to merge with Carillion to form a super-contractor.

Executive chairman Steve Marshall said: “Balfour Beatty’s key priorities are clear; the group is being simplified and refocused.

“The process for recruiting a new group chief executive is well underway. The Parsons Brinckerhoff sale process has remained competitive, and is also now well advanced.

“Our first-half trading and financial performance is in line with our most recent trading update. While our first-half performance has been significantly impacted by recent UK Engineering Services contract write-downs, the other parts of the group have continued to perform well. The Investments business has again demonstrated its significant value to the group.”

Balfour Beatty has had a wretched few months. Chief executive Andrew McNaughton resigned in May amid a series of announcements from the firm.

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