Balfour Beatty sees profit rise as order book fills

Infrastructure contractor Balfour Beatty said first-half underlying pretax profit rose four per cent, in line with expectations and lifted by a one-off gain from the sale of investments.

The company, which operates in 80 countries and whose projects include the refurbishment of London Blackfriars station and the building of Hong Kong's West Island metro line, posted a pretax profit from continuing operations of 138 million pounds in the six months to end July, from £133m a year earlier.

This was lifted by a £14m gain from ongoing infrastructure investment disposals.

The group's order book has increased six per cent in the past year to 15.5 billion pounds, boosted by a strong order intake in U.S. construction, Balfour said in a statement on Wednesday.

Analysts at JP Morgan had forecast a first-half pre-tax profit of £140m and an order book of £15.6bn.

Hochtief and Austria's Wienerberger also reported earnings on Wednesday, with Germany's largest builder Hochtief beating estimates thanks to a rise in new orders.

Contractors across Europe are facing a sluggish recovery, dragged down by austerity measures and civil spending cuts at home and abroad.

Balfour repeated that it sees a recovery in the medium term, but there will be further pain in the short-term.

"Looking ahead, we will continue to manage the business on the basis that market conditions will remain tough," said Chief Executive Ian Tyler in a statement.

Shares in Balfour Beatty closed at 262.9 pence, valuing the group at 1.8 billion pounds. Shares have lost 25 per cent of their value since March over broader market worries, particularly the outlook for US `infrastructure.