Construction firm reveals £41m losses - but gives assurances on North-East jobs (From The Northern Echo)
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Balfour Beatty, which employs 600 North-East workers, reveals £41m construction services losses
A CONSTRUCTION firm employing more than 600 North-East workers says their posts are safe, despite bosses revealing £41m losses.
Balfour Beatty, which has offices in Middlesbrough, Sunderland and Newcastle, says its regional teams will not be affected by disappointing half-year results in its construction services division.
The 104-year-old company, which helped build the £269m London Olympic Games swimming centre and is working on a new Heathrow Airport passenger terminal, cited the stagnant UK construction market for as a catalyst for the disappointing figures.
The firm, which employs 112 construction workers across Newcastle and Sunderland and has a 50-strong Middlesbrough power distribution team, who work alongside National Grid and Northern Powergrid, saw construction revenues fall from £3.3bn to £3.1bn, with group underlying pre-tax profits falling to £45m from £150m.
The results come after Balfour issued a £50m fall in profits in April, blaming market conditions and a lack of major public projects.
Bosses say its strong construction order books in the US and Hong Kong were offset by its UK results, and revealed it will leave its mainland Europe rail business and cut costs in its Australian construction management and project design division as it looks to improve group results.
It recently completed work on a £21m sea defence project at Redcar and is carrying out a civil engineering project to build a dual carriageway on the former Vaux brewery site, in Sunderland, and says cuts to regional services have also had a positive effect.
A report said: “Our markets continue to be challenging, but our actions are delivering results.
“We took the decision to close regional units with weak future prospects and those actions are taking effect.
“The regional order book is stable, though winning major projects has been impacted by continuing delays in the power market.
“In the longer term, our goal is to capitalise on the growth in global infrastructure from an international footprint of local businesses, and the benefits from this, combined with the impending recovery in some of our mature markets position us well for the future.”
The company is currently working on a major electrical and mechanical refit of the Eldon Square Shopping Centre, in Newcastle, and in June completed a £16m scheme to build a cancer care centre in the city.
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