The international infrastructure group says the key 2024 objective of growing the profit from earnings-based businesses (Construction Services and Support Services) was achieved, with underlying profit from operations (PFO) from those businesses increasing by 7% to £252m (2023: £236m), while the year-end order book increased by 12% to £18.4bn (2023: £16.5bn) following progress in Balfour Beatty’s chosen growth markets.
The group’s underlying profit for the year improved to £227m (2023: £205m) driven by the earnings-based businesses, increased gains on Investments disposals and higher net finance income. Non-underlying items after tax were a loss of £49m (2023: £11m) and included a charge in relation to the Group’s obligations under the UK Building Safety Act (BSA).
In 2024, £161m of cash was returned to shareholders (2023: £208m) through a combination of dividends and share buybacks and average net cash increased to £766m compared to £700m in 2023.
Balfour Beatty says the group has a positive outlook with further profitable growth from earnings-based businesses expected for 2025 and 2026. Group chief executive Leo Quinn said: “The Group made further strong progress in 2024. We once again delivered managed profitable growth from our earnings-based businesses and healthy cash generation, while also increasing our high-quality order book.
Balfour Beatty says the strong group portfolio performance was led by the UK, and adds: “Balfour Beatty’s geographical, operational and contract diversity is a key strength of the Group, and has been an important factor in the consistency of its financial results in recent years. This was further demonstrated in 2024, as the Group delivered profitable growth in both of the earnings-based businesses.”
The group says construction services underlying PFO increased to £159m, as UK construction PFO margin continued to improve with a further year of strong project delivery and Gammon recorded 14% revenue growth, while US construction profitability reduced due to the cost of delays at a small number of civils projects. Support Services delivered strong growth, with revenue increasing by 20% and PFO margin remaining close to the top of its targeted range.
Infrastructure Investments surpassed its disposal targets, which offset an increase in costs. The Directors’ valuation of the Investments portfolio increased by 3% to £1.3bn (2023: £1.2bn), with two new projects added. The group has forecast further growth in the medium term, driven by its focus on four key markets; UK energy, transport and defence and US buildings.
Balfour Beatty says the group has a positive outlook with further profitable growth from earnings-based businesses expected for 2025 and 2026.
