Shares for UK-based infrastructure giant Balfour Beatty were up 2.2 per cent following a boost in expectations for revenue and profit.
The construction company said it was five per cent ahead of 2021’s £16.1bn in terms of its order book, as it raised expectations for its full year report.
Balfour Beatty also raised prospects for a five per cent increase in revenue on last year which was at £8.3bn.
It said profits for the year are now “expected to be ahead of market expectations”, while the firm said it has £800m in the bank, up from previous guidance of £740-780m.
Leo Quinn, Balfour Beatty chief executive, said: “We continue to expect a strong full year operational and financial performance.”
Looking to 2023 and beyond, our improved, de-risked and diversified order book gives us confidence that we will continue to make progress in delivering profitable managed growth.”
The firm said its bumper results were helped by contracts for major constriction projects such as SCAPE Civil Engineering frameworks in the UK, worth almost £4bn.It also had projects in the US worth more than £1.7bn and in Hong Kong.
Other areas it benefited from are support services including for local council and disposing of five assets during the year worth £90m.
Matt Britzman, Equity Analyst at Hargreaves Lansdown
“Balfour Beatty looks to be heading into the final stretch of the 2022 financial year in decent shape, both profit and cash flows are expected to be higher giving management the confidence to continue buying back shares into 2023.”
That’s a clear statement to the market that management still feel the shares offer good value, with them trading hands at 11 times forecast earnings.”
On its profit and revenue boosts, he said it’s “worth remembering favourable exchange rates are the main driving force which aren’t an underlying, or ongoing, growth factor.”
He added “around 90% of the UK order book is now in public sector projects, which offer significantly more resilience in a downturn.”