The disastrous Peterborough & Huntingdon gas station job saw a final settlement with National Grid of £43.4m which dragged reported figures down.
Chief executive officer Alex Vaughan is confident a revamped Costain can take advantage of growing infrastructure opportunities as the market continues to evolve.
He said: “Infrastructure is facing enormous change, underpinned by significant committed investment and generating huge opportunities for us and, in my mind, addressing these changes requires a different approach.
“We have aligned our services to meet the changing needs of our clients, allowing us to shape, create and deliver pioneering solutions that transform the performance of the infrastructure ecosystem.”
Outside of problem contracts, Costain made an adjusted pre-tax profit of £26.3m from a turnover of £1,178.6m at an operating margin of 2.6%.
By the end of 2021 Costain has secured £1bn of revenue for this year “incorporating our broadening mix of construction, consulting and digital services.”
The order book stood at £3.4bn, down from £4.3bn last time “reflecting our clients five year investment programmes, greater discipline in contract selection and the shorter lead time of consulting and digital work.”
The problem Peterborough & Huntingdon and A465 jobs led to a complete revamp of Costain’s contract risk management.
All potential new jobs are double checked by specialist teams outside the contract bidding team while the legal team has been restructured and strengthened to ensure that contracts being entered into are rigorously assessed.
On contract delivery a new Operational Excellence Model has been implemented across the whole construction contract portfolio while the financial performance of every contract is comprehensively reviewed monthly.
Vaughan told the Enquirer: “Having a fresh set of eyes look over things bidding teams have been working on for months has been invaluable in terms of stress testing bids and finding the best solutions.”