The disastrous performance saw the group slump to a total loss of £59m in 2014 on a turnover of £8.4bn.

Group chief executive Leo Quinn has now launched a major cost-cutting drive designed to save £100m in overheads.

The cuts are part of Quinn’s “Build to Last” turnaround programme which is being rolled out over the next 24 months.

Balfour said: “In the UK, enabling functions – those not related to front-line delivery – are being consolidated to remove duplication and improve efficiency, to deliver significant cost takeout.

“The Group’s property portfolio is being streamlined to reduce overheads and detailed procurement initiatives, commencing with key suppliers and areas of direct and indirect spend, will deliver meaningful and growing savings.”

*Includes legacy building services contracts and Rail Germany writedowns

The UK construction problems include a further £118m write-down on problem contracts.

The announcement follows a £70m write-down in January as the results of contract reviews by KPMG filter through.

Balfour said the reviews were now complete on 70% of its business.

Quinn said: “The root cause lies in the Group’s rapid fourfold revenue expansion since 2000, largely by acquisitions which were insufficiently integrated.

“This resulted in an overly complex, devolved organisation with poor controls and weak disciplines in cost control and project bidding.

“Following a major industry downturn, the UK construction business was extensively restructured in successive waves and began to exhibit serious project issues which, together with other factors, resulted in substantial operating losses for the Group.

“The cost base remains too high, with current Group-wide overheads approximately 1% of revenue above industry benchmarks.”

Quinn admitted that Balfour faces “major short-term challenges” in its two-year turnaround programme.

He said: “Over the next two years we should work through the severe legacy of “problem” construction projects.

“However, in tackling the cultural change required to ensure these issues are behind us, we face major short-term challenges. The key is that we are determined to address this through self-help.”

Balfour is not paying a final dividend to shareholders this year “to maintain balance sheet strength throughout this period.”

Balfour’s share price was up 6% in early trading.