Balfour Beatty is to repay the money it claimed under the government’s covid-19 UK Job Retention Scheme after it made a £48m pre-tax profit in 2020.
In the group’s results for the year to 31 December 2020, it revealed total revenue of £8.6bn, up from £8.4bn the year before.
However, the effects of the pandemic weighed on its bottom line. The £48m pre-tax profit was down significantly from the £138m it made the year previously.
Nonetheless, the business made the decision to repay the £19m in government furlough cash and was buoyed by news that its order book has risen 15% to £16.4bn. Its average net cash was also stronger than previously indicated, at £527m.
Balfour said it had seen a “significant reduction in profitability” due to a combination of the impact of covid-19, a reassessment of end-of-contract forecasts in construction services, and the decision to defer any disposals from its infrastructure investments arm, given market conditions.
In the first half of the year, it reported an operating loss but managed to improve to a profit by the end of the year.
While UK construction has returned to profit after grappling with the challenges of site closures, lower productivity and increased operating costs, Balfour said some areas in which it operates, such as aviation, have seen a “material slowdown” throughout the year.
Leo Quinn, Balfour Beatty Group chief executive, said: “Throughout the pandemic, we have protected the group’s strengths, supported our stakeholders and held firm to our disciplines. That we achieved this while exceeding our own targets for net cash demonstrates Balfour Beatty’s resilience and the dedication of our people and partners.
“Our leading positions in large growing infrastructure and construction markets, record year end order book and £1.1bn investments portfolio provide confidence in future cash generation.”
