Balfour Beatty share price inches up as it returns to profit after two years of losses as order book grows 15 per cent
Balfour Beatty has reported a profit for the first time in two years, after growing its order book by 15 per cent in the 12 months to 31 December 2016.
The figures
Underlying operating profit was £67m, following two years of losses, and pre-tax profit was £60m, compared with a £123m loss in 2015.
Underlying revenue was up four per cent to £8.5bn from £8.3bn.
The group's order book grew by 15 per cent to £12.7bn, from £11bn the year before.
Balfour recommended a final dividend of 1.8p per share, bringing the full year dividend to 2.7p.
The group's share price went up one per cent at the open.
Why it's interesting
The construction firm has been trying to turn itself around over the past two years, after issuing a series of profit warnings in 2014, which was also the year merger talks with rival Carillion collapsed.
Balfour brought in Leo Quinn as chief executive to lead the transformation, and his actions – which include re-organising senior management and simplifying the business – look like they're paying off.
What Balfour Beatty said
"The transformation of Balfour Beatty is well underway," said Quinn. "We have returned the group to profit and significantly exceeded our Build to Last Phase One targets.
"We have upgraded leadership, processes and controls while continuing to invest in the group's unique strengths. As a result, we have improved not just the quality of our order book but our customer satisfaction scores."
He added: "Having simplified the group, we are focused on our core markets in the UK and US, where governments are committed to large scale expenditure on infrastructure.
"All this positions us for future profitable growth. During the next two-year phase of Build to Last, we expect to achieve industry-standard margins and over the medium term, industry-leading performance."