Balfour Beatty plc (LSE:BBY) shares climbed almost 10% as it confirmed it intends to buy back £100 million of shares this year even though profits dropped in 2023.
Orders also fell to £16.5 billion from £17.4 billion, though Balfour said the book was flat on a constant currency basis which was “encouraging” given recent interest rate rises.
“The second half of the year showed a clear improvement in orders compared to the first half as interest rates in both markets stabilised,” it added.
The civil engineering contractor posted profits of £244 million (2022:£287 million) over the twelve months while revenues rose by 7% to £9.6 billion.
Balfour blamed the lower profits on reduced gains on investment disposals adding that at the operations level the total was “incrementally ahead”.
Going forward, Balfour added it is targeting "both sides of the energy equation".
“On supply, steep growth in the volume of UK power transmission and distribution projects will begin in 2025, with an acceleration of work to strengthen and stabilise the power networks, while nuclear, wind, carbon capture and hydrogen projects continue to develop
“On the demand side, given the group's involvement in HS2, construction of greener railways is a large part of the Group's UK operations today and the importance of continued investment in the transport sector is evident for both political parties.
Leo Quinn, chief executive, added: “Looking to 2025 and beyond, we expect our unique capabilities and complex infrastructure project experience to drive further earnings growth, with attractive opportunities being pursued in the UK energy, transport and defence markets and the US."
As well as the buyback, the dividend for the year rises to 11.5p from 10.5p.
Shares rose 31.8p to 371.6p.