Balfour Beatty pride themselves as one of the world leaders of infrastructure, providing the “assets societies need to function, develop and thrive”. This exemplifies their confidence, which was mirrored back in August 2014 by rejecting rival Carillion’s £3billion offer to merge for the third time.
Since August however, Balfour Beatty has been forced to admit the presence of a £75million hole in their UK profits- making this the fifth profit warning in two years. The loss was caused by many divisions; £30million was lost within engineering services, £15million from regional construction and £10million from major infrastructure projects. After this announcement was made by current Chairman Steve Marshall, shares experienced a downfall of more than 20 per cent- down to 179.3p, their lowest price since 2003.
Balfour Beatty have called on accountant KPMG to carry out a full investigation concerning the profit loss, however a large proportion of the blame has been placed upon the recession. Balfour won several jobs during the recession, but with costs rising dramatically and skilled workers in short supply making a profit proves difficult. This case demonstrates all too well the impact of the recession within building and construction services, and how it is still affecting us in today’s economy.
Despite the turbulent times Balfour Beatty have remained at the top of business.co.uk’s contractors’ league table - after securing a £206m contract haul comprised of over 19 different projects. One of these projects is their role as sole contractor on a joint venture with AMEC and Jacobs providing a nuclear waste processing plant at Sellafield in Cumbria, UK. This project, which begins in the fourth quarter of 2014, was claimed by their UK construction Chief Executive Officer, Nicholas Pollard, to “underscore Balfour Beatty’s success and capability in the UK power sector” and suggests that Balfour Beatty is far from struggling despite the recent challenges they have faced.
Following the departure of Nicholas Pollard after the profit warning, Balfour Beatty have responded by appointing Leo Quinn as his replacement. Quinn, who played a fundamental role in the turnaround at Qinetiq over recent years, has accepted the recent setbacks experienced by Balfour Beatty and is determined to “restore Balfour Beatty to its rightful place on the global stage”.
Here at Blueprint we recognise the struggles that have been felt over the past few years, but like Balfour Beatty we are optimistic for the future and believe that the industry will resume, and exceed its pre-recession activities.
If you would like to get involved at this exciting time, then give us a call today to chat to one of our team in confidence on 02392 603030.
Alternatively, you could look on our website to find out what opportunities are available. Current Building Services Jobs
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