Operating profit at ground engineering firm Keller fell by 68% to £13.7M worldwide in the first half of 2010, compared to £42.8M in the same period last year.
Global turnover at the world’s largest geotechnical firm was over 10% down on last year at £552.6M.
Keller chief executive, Justin Atkinson said: “The first half has been a challenging period for the group particularly in the US, where the construction market continued to deteriorate.”
“However, we have been encouraged by the progress made in our developing markets, where we have continued our success of recent years in profitably growing our business. This demonstrates the benefit of our strategy of geographic diversification, to which we remain fully committed.”
After making a small loss in the first quarter, which the firm put down to a weak US construction market and severe weather in Europe and the US, the firm saw a significant improvement in the second quarter.
Keller faced another difficult year in the UK where it reported an operating loss of £100,000 the six months leading up to 30 June. Despite the loss this is an improvement on last year where operating losses stood at £400,000 at the half year mark.
Atkinson said: “The UK market remains very challenging and our UK business has been further downsized to reflect this. Where possible, skilled people are being considered for transfer to other parts of the Group, such as Australia, where demand remains high”.
“We are hopeful that the continuation of investment in Crossrail, together with other planned infrastructure projects which will call for specialist geotechnical and monitoring services, will underpin an improvement in our UK business in 2011.”
Developing markets, such as Australia – which now accounts for 35% of global revenue, and Asia provided some respite.
The firm had expected the drop in profits and had issued a warning to market in May. Keller chairman Roy Franklin said the firm had seen no real change in its key construction markets since that time and the full year expectations “remain within the current range of market expectations”.