UK power and US data centre booms see Balfour Beatty increase 2026 profit forecasts

Balfour Beatty said that full year results will be better than expected as the firm said key markets in the UK and US were booming.

The country’s biggest contractor said workloads in the half year in UK power were up 24% while US buildings income, which includes data centres, was up by 19%.

Group revenue in the six months to June was up 8% to £5.6bn with pre-tax profit standing at £129m, down from £132m.

Chief executive Philip Hoare singled out the UK power market where it recently won a £325m power transmission project in Scotland and US buildings work, particularly data centres where it has been working in that market for two decades.

It has tended to build data centres in the north-west of the US but Hoare said its reach was now spreading to other parts of the country.

He added that it does not carry out data centres work in the UK or Europe, saying the margins in the two areas were not good enough. “It’s quite competitive and I’m not keen on entering into low margins.”

He said workloads in the UK transport sector would likely switch from capital expenditure to maintenance in the coming years and was expecting growth to be flat.

Hoare added that its negotiations with HS2 over the railway’s contract reset with its contractors were ongoing, adding that he didn’t know when they would be concluded. “We are working with [HS2 chief executive] Mark Wild in a positive way.”

Jobs Balfour Beatty is carrying out on the railway include the Old Oak Common station scheme in west London which has recently seen the first of six 450m-lomg passenger platforms installed.

Meanwhile, Hoare said his impressions of new prime minister Andy Burnham were “positive” and added: “He seems to be valuing the hard hat which is good because I’ve got a lot of people who wear hard hats.”

Balfour Beatty said it had raised its full year guidance and was now expecting profitable growth slightly ahead of previous expectations with the firm saying the percentage increase would be in the lower double digits. Last year, the firm made a pre-tax profit of £323m on revenue of £10.8bn.

The firm said average net cash during the half year was up £400m to £1.6bn on the full year with its order book up £200m to £22.9bn on 2025’s number. It added that its interim dividend was up 12% to 4.7p.