Balfour Beatty kept on track by £10m assets sale

By DOMINIC JEFF
Published on 11/07/2012 00:00

A £10 MILLION gain in asset sales offset rising operational costs to keep infrastructure giant Balfour Beatty on track for the year.

The company said yesterday that its order book remains stable at £15 billion, “despite the continuing uncertainty around governments’ investment decisions and the absence of larger, more complex projects”.

The firm sold some of its public-private partnership interests, raising more than originally expected.

But it said cost increases in a small number of contracts in the utilities sector would offset the gain in its results.

The firm added that weak performance in the rail division, predominantly in Europe, was offset by strong performance in its various joint venture businesses.

Investec analyst Andrew Gibb said the trading update was “disappointing” and the company remained on target only because of the disposals, which he said raised about £50m in total.

“This is disappointing and should raise question marks,” he said. “We see nothing in this statement to justify the strong run the share price has enjoyed of late.

“This is a business in underlying decline and we retain our ‘sell’ recommendation.”

Shares in the company, which has a civil engineering division based in Edinburgh, closed 2.8 per cent lower at 302p.