The UK’s biggest construction firm Balfour Beatty has bucked the industry gloom after telling investors trading would remain “strong” this year.
Balfour said it had won £400 million of new orders in the first five months of the year, taking its order book to £11.8 billion.
Among the new deals for the firm, which operates in more than 20 countries, is a $330 million (£150 million) contract to build a new highway in San Antonio, Texas. It has also been selected as part of the consortium to build the £445 million M74 extension in Glasgow.
Balfour said the future pipeline of work was also looking good thanks to being selected as the preferred bidder for the M25 widening and maintenance project. The contract award, which involves adding an extra lane of traffic to 63 miles of the 120-mile orbital carriageway, will be formally announced later this year.
The firm said: “Trading in the year to date continues to be strong. We anticipate that order intake and trading performance will remain strong throughout the year and that we will make good progress in 2008.”
Balfour’s upbeat comments come in stark contrast to woes being seen in the wider construction sector as firms battle against dwindling project finance and rising costs.
Two surveys were the latest to paint a dark picture. The Chartered Institute of Purchasing and Supply (CIPS) said its Construction Purchasing Managers’ Index - which measures overall industry performance - showing activity slowed at its fastest rate for at least 11 years last month.
Another report from the Royal Institution for Chartered Surveyors (RICS) found that construction workloads were falling at their fastest rate since 1995.
But Balfour said its engineering division was showing “very good progress” thanks to its acquisition of Ringwood in Hampshire-based firm Dean & Dyball. The firm’s projects include developing the London 2012 Olympic sailing facilities at Portland in Dorset.
Broker Panmure Gordon said in a note: “In a sector where the doom and gloom gets worse by the day, Balfour Beatty report upbeat trading. It is seeing solid trading across its main UK and US operations.”