The Heavy bidding costs for PFI contracts hit Jarvis' results for the six months to 30 September, with profit falling 31% from £12.6m to £8.7m.
However some analysts think the company may have turned the corner after the dismal performance of its share price over the past year.

Granville Baird analyst Mike Foster pointed to the success of Jarvis Accommodation Services as one reason for optimism.

Jarvis claimed that a recent restructuring was beginning to reap operational benefits, and most analysts were encouraged by a 19% rise in turnover to £317m.

Jarvis also revealed that it has set up a partnership with an Indian rail contractor to find engineers to plug a growing skills gap.

Jarvis said it was still in talks with Railtrack to recover £15m from long-term contracts.