Balfour hopes profits back to “normal” next year after £26m loss

Grant Prior 4 years ago

Balfour Beatty is predicting profits will recover to “normal” levels next year after the impact of Covid-19 saw the contractor post a pre-tax loss of £26m for the first six months of this year.

That compares to a £63m profit last time as turnover rose to £4,118m from £3,884m.

Balfour kept most of its sites open during the pandemic and said its Build to Last programme ensured a resilient response to the crisis.

Group Chief Executive Leo Quinn said: “We have preserved the disciplines, expert capability and financial strength we will need as markets move back to normal and then beyond, driven by fiscal stimulus for infrastructure.

“In achieving this, our systems, processes and leadership have all proved the value of our investments over the last five years.”

Quinn said he expected “the earnings-based businesses to recover steadily through the second half of 2020 and report a more normalised operating profit in 2021, broadly in line with 2019.”

For the full year in 2019 Balfour posted a pre-tax profit of £138m.

UK Construction recorded an underlying loss from operations in the first half of 2020 of £23m compared to a £17m profit last time on turnover down to £986m from £1,014m.

Balfour said: “Covid-19 had a material impact on operations as Scotland was effectively closed for the second quarter of 2020, London has seen limited productivity due to public transport availability, the South region has been affected by the slowdown in aviation and lengthening site programmes triggered a reassessment of the Group’s contract end forecast positions.”