Balfour Beatty has published its preliminary results for the year ended 31 December 2008. The company said that the results showed strong progress, demonstrating the resilience of its financial model.

Balfour Beatty said that 2008 had been another year of very good progress, driven by the strength of its business with public sector and regulated customers and the performance of acquisitions. The company order book was £12.8 billion (of which the the building sector order book is £6.7 billion) at the end of 2008, with £4.9 billion of further work at preferred bidder stage.

The company said the high-quality order book and continued infrastructure expenditure, along with the full-year impact of acquisitions, would drive growth in 2009 and that while declining volumes and increased competition in some private sector markets will have some impact in the sector, it anticipated making further progress in the year.

Following acquisitions of Birse in 2006 and Cowlin in 2007, Balfour Beatty acquired Dean & Dyball, a well-established contractor in southern England and Wales, in March 2008, one of a number of purchases that have continued to enhance earnings potential. Together with Mansell, which was acquired in 2003, the company has now substantially enhanced its regional coverage across the UK.

Profit from continuing operations in Balfour Beatty’s civil and specialist engineering and services sector, rose by 27% to £104 million (2007: £82 million), while Balfour Beatty Management, its professional and technical services business, continued to grow strongly. The sector order book increased by 11% to £4.9 billion at the end of 2008.

Balfour Beatty Management, the UK-based professional services business, continues to grow and is now playing an iincreasingly important role, supporting cross-Group activities for a number of what Balfour describes as its 'sophisticated, major customers'.  The company said that as customers’ demand for a higher-level, integrated presence at the top of their supply chain increases, professional services will become a much more significant part of the Group.

Balfour Beatty now has over £9 billion in revenues, including joint ventures and associates, and a leading presence in selected key markets.

Financial hghlights include:

• Pre-tax profit up 24% to £249 million
• Adjusted earnings per share² up 14% to 39.9p
• Cash generated from operations was £297 million
• Average net cash in the year of £239 million
• Order book of £12.8 billion at year-end
• Recent acquisitions performing well
• Final dividend of 7.7p, full-year dividend up 11% at 12.8p

In a joint statement, Chairman Steve Marshall and  Ian Tyler, Chief Executive, said,

“Balfour Beatty produced another excellent financial performance in 2008, together with further progress in the Group’s strategic development.

“We are strong both operationally and financially and the majority of our work is with public sector and regulated customers, who are long-term investors in infrastructure.

“While the difficult economic environment will have some impact on our businesses and creates greater uncertainty, we anticipate making progress in 2009.”