Balfour Beatty plc (LSE:BBY) said it is trading in line with expectations and pre-pandemic levels, with a high-quality order book for next year.
Revenue for the current year is expected to be double that of the £4.2bn reported for the first half, the infrastructure group said in a trading update covering the period to 8 December 2021. It posted revenue of £8.6bn in 2020.
Underlying profit from Construction Services and Support Services, the group’s earnings-based businesses, are forecast to be in line with the 2019 figure of £172mln.
Balfour Beatty said its order book is expected to be around £15.5bn at the end of the year, compared with £16.1bn at the end of the first half and £16.4bn in 2020.
Full-year average monthly net cash is expected to be over £650mln versus £611mln in the first half and £527mln last year.
The company has returned £150mln to shareholders this year and is planning at payout of at least £100mln in 2022.
Balfour Beatty said tendering has returned to pre-pandemic levels at its construction business in the US, where the underlying market is supported by the Infrastructure Investment and Jobs Act which provides over US$1trn in federal spending over the next five years.
Following the increase in the margin target range from 3%-5% to 6%-8% in August, the Support Services division has maintained its strong performance into the second half, with power, road and rail maintenance units continuing to meet expectations.
In Infrastructure Investments, the company has invested around £20mln in four new projects and is shortlisted on two US public private partnerships (P3) projects.
It said it has measures in place to mitigate against inflationary pressures.
"The group is on track to deliver a 2021 performance in line with pre-pandemic levels,” commented chief executive Leo Quinn.
"Looking to 2022, the group has a high-quality order book. We are strongly positioned in three geographies where fiscal expansion, green infrastructure growth and, in the US, public private partnerships all play to our unique engineering capability. We remain confident of capitalising on these factors to drive superior returns."
Balfour Beatty said the investigation by the US Department of Justice (DoJ) into work by Balfour Beatty Communities at US military bases is ongoing. The company has completed its own investigation and shared the findings with the DoJ. The group said it is “actively working to resolve this matter in a timely manner”.
Shares climbed 2.43% to 253.20p in opening trade.