Balfour Beatty is striving for £30m in “cost savings” over the next year after recording a £141m half-year profit
This figure was 32% up on the same period in 2009, although it was skewed by its acquisition of US engineer Parsons Brinckerhoff last year. Underlying profit rose only 3%. Its order book in June was £14.6bn and turnover rose 2.5% to £5.2bn.
Despite the profit rise, Ian Tyler, Balfour’s chief executive, said his firm would focus on cost savings. He said Balfour Beatty had been “evaluating additional levels of cost efficiency” through procurement savings and a centralised accounting department.
The report said the changes would save £30m a year from 2012, following “one-off implementation costs” of about £25m and a further £10m in IT investment.
The cancellation of the Building Schools for the Future programme did not appear to have affected profits significantly, despite Balfour having numerous contracts and being preferred bidder on three schemes. Tyler said the firm’s £10bn turnover protected it from the schools cuts, which make up 2% of the business.
On the same day as it announced its half-year results, Balfour Beatty also reported it had signed up for a £460m deal to build satellite buildings at Heathrow Terminal 2.