Balfour Beatty stops bidding for central London fixed-price resi projects

While the business’s construction arm has started building the HS2 Old Oak Common station, cast its last nuclear grade reinforced concrete segment at Hinkley Point C nuclear power station, and handed over Woolwich Crossrail station, it has also suffered performance issues on what it described as a small number of private sector property projects in central London.

Balfour said the problems had been worsened by disruptions caused by covid-19, leading to lengthening project schedules and write-downs. As a result it plans to no longer bid for fixed-price residential property projects in central London.

Meanwhile, it warned that it could face a liability of up to £50m in respect of a high-rise London development completed in 2016 where facades will need to be modified, reinforced or replaced. Balfour said it would pursue all potential recoveries from third parties.

Leo Quinn, Balfour Beatty Group chief executive, said: “We continue to reshape Balfour Beatty to play to its strengths. These include leading capability in markets where governments are committed to long-term infrastructure programmes. It means choosing to exclude regions and sectors which cannot provide profitable, low risk growth, in favour of those that can. Our priority is on executing our already strong order book which will drive attractive cash generation and returns.”