BALFOUR Beatty has emphasised the value of its Built to Last streamlining programme as it posts its 2018 full year results, with the contractor returning to ‘industry standard’ margins in the second half of the year.
The company reported an underlying pre-tax profit of £181 million, a 10% increase on the 2017 figure of £165 million, while total pre-tax profit was £123 million (2017: £117 million). ‘Industry standard’ margins were achieved in the second half of the year, with Construction Services profit from operations increasing 32%.
Gross debt was reduced by over 40%, with £231 convertible bonds repaid. The group’s order book was up 11% on the previous year’s figure, increasing to £12.6 billion (2017: £11.4 billion).
Average net cash increased to £194 million (2017: £42 million) and year-end net cash was £337 million (2017: £335 million).
Leo Quinn, Balfour Beatty chief executive commented, “These results demonstrate the value being created through Build to Last. We continue to strengthen the Group and meet our targets. The businesses are back at industry standard margins, underpinned by a strong balance sheet and asset base.
“But Balfour Beatty’s transformation goes well beyond resolving the issues of forced growth. We have relentlessly invested in capability and leadership to forge a culture which provides sustainable competitive advantage through standardisation of our systems and processes, on a reducing overhead base.
“This gives us a scalable platform to drive profitable managed growth. With this internal momentum and our positions in large growing infrastructure markets, we are well placed to deliver market leading performance.”