Balfour Beatty pledges to repay the job retention scheme, as its 2020 financial results reveal the contractor is bouncing back from Covid
For the year to 31 December 2020, Balfour Beatty made a pre-tax profit of £48m (2019: £138m) on revenue up 2% £8,593m (2019: £8,411m).
Underlying profit from operations (PFO) sat at £51m (2019: £221m), after the company made the decision to repay the UK job retention scheme.
Balfour’s order book increased by 15% to £16.4bn (2019: £14.3bn).
The average net cash for the company was at £527m (2019: £325m), which exceeded expectations.
In the first half of 2020, Balfour Beatty reported a loss from operations, and then somewhat recovered in the second half of the year. All segments recorded a profit resulting in a full-year underlying profit from operations of £51m (2019: £221m).
The fall in profits was largely due to Covid-19. UK Construction documented a £26m loss for the year as lower productivity, site closures, additional operating costs and lengthening site programmes all take its toll.
The investments arm deferred planned sales of infrastructure investment assets until markets pick up.
‘Confidence in future cash generation’
Leo Quinn, Balfour Beatty group chief executive, said: “Throughout the pandemic, we have protected the group’s strengths, supported our stakeholders and held firm to our disciplines.
“That we achieved this while exceeding our own targets for net cash demonstrates Balfour Beatty’s resilience and the dedication of our people and partners.
“Our leading positions in large growing infrastructure and construction markets, record year end order book and £1.1bn Investments portfolio provide confidence in future cash generation.
“This underpins our new capital allocation framework which demonstrates Balfour Beatty’s commitment to deliver enhanced returns to shareholders.”
