Costain doubles profits in solid half year

Costain delivered a strong half year with pre-tax profits doubled despite a slight revenue drop, in its latest financial results.

Revenue for the six months to June 2024 fell 4 per cent to £639.3 million compared to the same period last year with £664.4 million. 

Pre-tax profit doubled to £17 million from £8.5 million in the first half of 2023, while operating profits were bolstered, increasing from £7.6 million to £13.9 million.

The company said its half year revenue reflected growth at its Natural Resources business (H1 2024: £192.0 million compared to H1 2023: £177.3 million).

However the company saw a slight reduction at its transportation division down 8.8 per cent at £444.3 million compared to £487.1 million.

Costain claimed it is on course to meet its margin targets of 3.5 per cent and 4.5 per cent during FY2024 and FY2025 respectively.

The firm also said it has a strong forward work position, with a healthy combined order book and preferred bidder book, increasing from £4.0 billion in the first half of 2023 to £4.3 billion in the same period this year.

It also announced the launch of a £10m on-market share buyback following its solid half year performance.

Costain has recently secured several contracts with Thames Water, including a £6.6 million contract to upgrade strategic treatment assets in Hertfordshire and  a design and build contract to upgrade two wastewater treatment sites in Berkshire and Hampshire.

Costain CEO Alex Vaughan said: “We are performing strongly and are progressing with our strategic priorities in our chosen growth markets, including broadening our customer and service mix. 

“Our focus on industry-leading solutions, predictable performance and long-term established customer relations has seen us win further significant Water contracts post period end and we expect further wins for the Group in the second half of the year. 

“The quality and customer balance of our forward work position across our two divisions, together with strong highly visible market investment, gives us good visibility on future revenue and margin. We continue to deliver improvements in the business and remain confident in the Group’s prospects.  

“As a result of our confidence in our long-term prospects, and our strong cash position, we have today announced a £10m share buyback which will commence with immediate effect.”   

Was this interesting?Try Browne wins £130m Thames Water mains renewal contract

If you have a tip or story idea that fits with our publication, please contact the news reporter miles@wavenews.co.uk