Balfour Beatty, a UK-based construction company, has published its financial results presentation.
The presentation reveals an increase in profits, providing a strong foundation for future growth.
Financial performance
Revenue for 2024 grew by 4% to £10 billion, with notable contributions from both Gammon, its joint venture in Hong Kong, a leading construction business involved in various infrastructure projects, and Support Services.
Support Services is Balfour Beatty’s division that provides a range of services such as facilities management, asset management, and construction-related support to public and private sectors.
The Group's earnings-based businesses, which encompass Construction Services and Support Services, saw profits rise by 7%, amounting to £252 million.
Additionally, gains on investment disposals and net finance income exceeded expectations, contributing to an 11% increase in the Group's overall profit, which reached £227 million.
The presentation reveals an increase in profits, providing a strong foundation for future growth
Earnings per share rose by 17% to 43.6 pence.
The Group's order book also saw healthy growth, rising by 12% to £18.4 billion, with a 3% increase in the director's valuation.
Average net cash was £766 million, exceeding prior estimates, while year-end net cash stood at £943 million.
Reflecting the strong performance, the Board announced a final dividend of 8.7 pence, bringing the total dividend for the year to 12.5 pence—an increase of 9% compared to the previous year.
In the UK, the construction order book rose to £6.2 billion
Balfour Beatty’s Construction Services division showed modest overall growth, with strong performances across most businesses.
In the UK, profit from operations (PFO) increased to £81 million, with improved margins driven by strong operational performance and a lower-risk project portfolio.
The company’s order book continues to grow, with a 12% increase to £18.4 billion.
In the UK, the construction order book rose to £6.2 billion, with an emphasis on low-risk contractual terms.
Strategic progress and cultural transformation
Balfour Beatty’s success is not solely attributed to financial growth.
Over the past decade, the company has undergone a cultural and operational transformation that has laid the groundwork for its continued success.
From a challenging period in 2014, when the company was facing significant financial difficulties, including a cash flow deficit of $1 billion and multiple profit warnings, Balfour Beatty has repositioned itself through its "Build to Last" programme.
This transformation has not only stabilised the company but has also improved employee engagement, safety, and overall business performance.
Over the past decade, the company has undergone a cultural and operational transformation
Employee engagement has risen significantly, with Balfour Beatty now scoring 84%—10 points higher than its peer group.
Safety has also been a key focus, with the company reporting a world-class safety record, where 32 out of every 33 employees return home safe each day.
Attrition rates have decreased to 10%, a remarkable achievement in a competitive labour market, and the company continues to invest in its workforce through apprenticeships and graduate schemes, as part of its commitment to long-term growth.
Looking ahead
Balfour Beatty’s successful financial performance in 2024 reflects a decade of hard work, cultural transformation, and strategic investments.
The company remains confident in its future prospects, with a strong order book and a focus on high-return projects across its various business divisions.
Looking ahead, Balfour Beatty is committed to continuing its growth trajectory, with plans for further capital returns to shareholders, targeting an additional £1 billion over the next five years.
The company’s order book continues to grow, with a 12% increase to £18.4 billion
As the company moves into the future, it is well-positioned to maintain its momentum, backed by a solid financial foundation and a clear strategic vision for sustained success.
Overall, Balfour Beatty’s leadership remains optimistic about the years ahead, emphasising that the work done over the past decade has set the company up for long-term success, ensuring its stability and growth for the next 100 years.