But as Costain concentrated on lifting group margin to 4%, revenue fell back around 5% to £934m.

Andrew Wyllie, chief executive, said the infrastructure division had a very successful year generating strong operating returns and additional gains on successfully completed and final accounted projects.

He said the rail, highways and airport division continues to see high tendering activity.

“Costain has delivered another strong performance and demonstrated again that it has the right strategy to drive profitable growth even through the most challenging of economic conditions.

“We entered 2013, having already secured over £700m of work for the year and we continue to benefit from a strong pipeline and high levels of tendering activity.

He added: “Our focus on providing innovative and cost effective solutions to increasingly complex and large-scale national needs, along with our partnership approach, is enabling Costain to build new and extend existing long-term relationships with a range of major customers.”

The shift away from lump sum towards cost-based contracting altered cash flows denting net cash from around £140m to £105m.

During the year Costain bagged new contracts and extensions worth £900m with the year-end total order book swelling to £2.4bn.

Over 90% of that order book now comprises repeat orders.

Around £1.7bn of revenue secured for 2014 and beyond.

During the year, Costain secured its first highways technology framework contract for the Welsh Government, an area expected to see increased investment in coming years.

It also secured its first rail electrification contract as part of Network Rail’s £37bn investment programme.