Balfour Beatty shares soar as firm bets on UK energy and defence
Balfour Beatty shares jumped after the construction firm posted surging profit as it doubles down on bets on UK energy, transport and defence infrastructure.
Profit at the FTSE 250 firm grew 51 per cent to £323m in the year to December 2025, as revenue climbed 7.5 per cent to £10.8bn and its order book reached a record £22.7bn.
The firm praised the government’s 10-year infrastructure plan for allowing it to commit to long-term projects, despite other recent construction leaders criticising Labour for adding red tape.
The government’s “infrastructure pipeline” database – which details all key ongoing projects – and its commitment to contribute £725bn to the UK’s infrastructure “brings improved certainty and clarity to the industry,” Balfour Beatty’s report said.
Balfour Beatty’s share price was up nine per cent on the Wednesday open, to 765p.
The firm announced a £200m share buyback scheme and increased its full year dividend by 12 per cent to 14p.
The group said this year holds a positive outlook for its four growth markets: UK energy transition and security, UK transport, UK defence and US buildings.
Balfour Beatty is betting on the UK’s net-zero transition as a source of key infrastructure projects, with involvement in the Teesside carbon capture power station and the Sizewell C nuclear power station.
Defence a key growth area
The firm also noted the government’s position on defence as a driver of growth as an opportunity for new projects.
“The Government recognised the necessity for further investment in UK defence, which it forecast will create hundreds of thousands of jobs and contribute to economic growth,” the construction group said.
In 2024, FTSE 100 defence giant Rolls Royce appointed Balfour Beatty to lead the expansion of the defence firm’s submarines site in Derby.
Balfour Beatty’s upbeat outlook on UK construction comes despite warnings from elsewhere in the sector that smaller firms are suffering from high cost and tax burdens, leaving them unable to meaningfully contribute to Labour’s 1.5m homes target.
On Tuesday, the government came under fire for its plans to introduce a public register of land development rights – aimed to increase transparency and prevent so-called “land-banking”.
Several leaders in the small to medium housebuilding sector said this policy sets out to “solve a problem that doesn’t exist,” and called on Labour to rethink adding more red tape to the planning system.
Mark Crouch, market analyst at eToro, said: “Balfour Beatty’s full year results suggest a contractor very much in its stride. In a sector where margins can evaporate at the first hint of trouble, the infrastructure and construction giant has managed to turn steady revenue growth of 8% into a 16% jump in underlying operating profit.
“Balfour’s bread-and-butter earnings businesses, notably UK power transmission and US buildings, are now firing on all cylinders.”