Half-year losses have widened at enigineering firm Balfour Beatty to £150m, in comparison to a year ago when it reported a loss of just £58m.
The news comes as the company continues to struggle to recover following a string of profit warnings over the past few years, mainly down to problems at its UK construction business.
Balfour Beatty posted underlying losses of £130m versus a underlying profit of £15m for the same period last year. The company said its order book and underlying revenue had remained stable at £11.3bn and £4.09bn respectively.
Leo Quinn, group chief executive, said: “Six months in, our Build to Last transformation programme is gaining traction throughout the business.
“We have a new senior leadership team and an organisation re-aligned with key customer sectors. We are on course to meet our 24-month targets for £200m cash in and £100m cost out.
Last month Balfour announced that a partnership with one of Yorkshire’s biggest family businesses, NG Bailey had been named preferred bidder for EDF’s £1.3bn Hinkley Point C nuclear power station.
Balfour Beatty Bailey - a joint venture between NG Bailey and Balfour Beatty - will work across both proposed Hinkley Point C units to deliver critical infrastructure that will power the station and its operations.
Mr Quinn said: “In rising core markets, the group is continuing to win business on better terms across our operations. In the last few months the awards of contracts or preferred bidder status for three landmark projects - Bergstrom Expressway in Austin Texas, nuclear new build Hinkley Point C power station electrical package and a UK smart motorway package - is a further endorsement of Balfour Beatty’s leading capabilities.”
Balfour has been counting the cost of the wafer-thin margins it accepted to win construction contracts during the financial crisis which have led to a series of profit warnings over the past two years. New boss Leo Quinn has embarked on a review to cut costs and resolve the issues.
The group said it had achieved £25m of savings in the first half and was on its way to achieving its target of £100m of cost savings by the end of 2016, part of its turnaround plan.
He added: “Inevitably the headline numbers set out the consequences of the historic issues that are now being tackled. However the continuing confidence of our customers in Balfour Beatty’s expertise, the positive response of our people to change, demonstrated by our excellent net cash performance, and the underlying strength of our balance sheet, supported by the Investments portfolio, all reinforce my conviction that over the medium term we can provide our customers, employees and shareholders with superior returns.”
Last year the chairman of Balfour Beatty, Steve Marshall, who had been running the firm since the departure of chief executive Andrew McNaughton, announced his intention to quit the troubled company after it issued its third profits warning.