The latest half year results published by Balfour Beatty show a £7 million underlying profit compared with last year’s equivalent figure of a £130 million loss.
While the overall total figure before tax is still a loss for the group, the £21 million figure is a significant improvement on the £150 million loss for the same time frame in the previous year.
The UK construction firm made a £66 million underlying loss, which was also an improvement on the figure for the same period last year, which saw a £145 million loss.
The company said that by stripping out the impact of additional losses on historical projects, the business would have come close to breaking even.
Balfour Beatty reported good progress on closing out the 89 problem contracts that were identified last year, with 81% of these at practical or financial completion by June this year.
The group’s underlying revenue was down 6% from last year, to £4.024 billion, while the order book rose by 7% to £12.4 billion and the firm said that disciplined bidding practices had been maintained.
In the UK, the order book grew from £1.9 billion to £2.1 billion at the end of the year, which was the company’s first growth in the UK order book in three years.
In that period, the company’s notable successes included an £82 million contract to build engineering and training facilities at RAF Marham in Norfolk, in readiness for the arrival of the UK’s first F-35 Lightning II aircraft in 2018; a contract for Highways England for the construction of a proposed lorry area near the M20, worth up to £130 million; and a £170 million contract to upgrade baggage screening and handling systems for Heathrow Airport.
As a result of the focus on bidding for contracts with increased bid margins and more favourable contract terms, the regional business is now focused on fewer, larger contracts and is reducing its exposure to contracts worth less than £5 million.