Balfour Beatty has published its trading update to 8 December 2022.
by Rory Butler / December 8, 2022
Financial
- Order Book: +5% FY2021 £16.1 billion (favourable FE; de-risked portfolio)
- Revenue: +5% FY2021 £8.3 billion (favourable FE)
- Cash: FY average monthly net £800 million
For Profit for the Year Balfour reported ‘ahead of market expectations’, due to + Net Int Inc and deferred tax assets significantly reducing 2022 tax charge.
Construction
UK
- Both SCAPE Civil Engineering frameworks: £3.25 billion and £750 million, over four years with optional two-year extension
US
- Maryland federal building: $700 million
- Florida convention centre: $400 million
- Texas multi-use development: $300 million
- Oregon data centres: $300 million
HK
- Causeway Bay: £300 million
Support services
- Buckinghamshire Council: £176 million (highways over eight years)
- East Sussex County Council: £297 million (highways over seven years)
Infrastructure investments
- £90 million – disposal of five assets
- £65 million – profit on disposal
- £30 million – in new projects
Capital allocation framework
- +£385 million to shareholders (via share buybacks/dividends since 2021)
- includes +£200 million in 2022 (similar cash returns expected in 2023)
Interest and Tax
Balfour expects Net Int Inc FY2022 (due to higher Int Rates; same in 2023).
Further deferred tax assets relating to prior UK tax losses expected to be recognised in Q3/4 2022, resulting in small tax charge.
In future, effective tax closer to statutory rates; UK cash tax payments below statutory in medium term as losses are utilised.
“We continue to expect a strong full year operational and financial performance,” said Leo Quinn, Balfour Beatty Group Chief Executive. “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.”
