In a challenging year, group pre-tax profit fell 15% to £244m, due mainly to lower gains from investment disposals.

UK Construction proved the star performer among the trading divisions, with higher transport volumes driving a 10% rise in revenue to just over £3bn.

Underlying profit at UK Construction increased to £69m from £59m last year as margins continued to recover to 2.3%, putting Balfour Beatty on track to meet its 3% target.

The UK Construction order book remained flat at £6.1bn, with 91% of those orders from public sector and regulated industry clients.

Leo Quinn, Balfour Beatty chief executive, said: “The group’s reliability and resilience has again delivered a solid performance, with increased revenue and profit from our earnings-based businesses and strong operating cash flow.

“This success against a challenging economic backdrop is driven by our disciplined contract risk management across a geographically and operationally diversified portfolio.”

Around the rest of the construction business, the Gammon business in Hong Kong improved revenue and profits while the larger US business saw flat growth with profit slightly down.

Amid the more challenging market average net cash at Balfour Beatty reduced to £700m compared to £804m in the prior year.

Despite a slightly reduced order book at £16.5bn (2022: £17.4bn), Quinn said the outlook remained strong for the year ahead with Balfour forecasting growth in underlying profits this year, with growth then accelerating in 2025.

“The group’s longer-term outlook remains positive and the growth forecast in 2025 and beyond is driven by the opportunities in the energy, transport and defence sectors in the UK and the group’s chosen buildings sectors in the US, ” said Quinn.

In the UK, Balfour said it expected to see steep growth in the volume of power transmission and distribution projects in 2025, with an acceleration of work to strengthen and stabilise the power networks, while nuclear, wind, carbon capture and hydrogen projects would continue to develop.