Costain revels in strong order book

Costain has remained upbeat about its financial position two months ahead of its interim results.
 
In a trading update Costain said its position was currently in line with its forecasts and said that at 30 June the order book stood at £3.7bn exactly on par with its position at 30 June 2017.

The contractor is also a preferred bidder on £400m worth of contracts and said tendering levels remain high.

Costain said it still had a strong balance sheet, finishing the period with a net cash position of £75m, down from £87.5m at 30 June 2017, reflecting timing of receipts.

The average month-end net cash was £90m in the period compared to £97.3m in 2017. 

The contractor pointed to its use of “technology and innovation” across infrastructure as a reason for its strong forward order book.

Costain has recently won a spate of technology contracts including the M6 J21a-26 smart motorway contract and Motorway Incident Detection and Automated Signalling (MIDAS) technology systems contract for Highways England.

It also recently announced its planned expansion to a new enlarged technology centre in Somerset. 

The firm, who has finally drawn a line under its loss-making waste management deal, saw a pre-tax profit jump of a quarter last year.

Costain won the £400m contract to design and build 43 facilities across 27 sites as part of Greater Manchester Waste Authority’s £3.8bn waste management project a decade ago but suffered a series of losses after mired in snagging work.

But last August, the firm said it had agreed a deal with operator Viridor Laing to finish up work the following month.

In its results released in March, Costain said it had now left the job completely and that provisions on the PFI deal had already been accounted for.

Chief executive Andrew Wyllie said revenue was up 4% to £1.7bn while pre-tax profit was up 25% to £38.9m. Its order book at the year end was £3.9bn.

The firm is due to release its interim results on 22 August.