Balfour Beatty has announced a £199 million pre-tax loss in its full-year results for 2015.

However, despite revenue being down 4% at £8,444m (2014:£8,793m) and issues with numerous legacy contracts, Chief Executive Leo Quinn said he was confident the company can "reach industry-standard margins" with its 24-month 'Build to Last' transformation programme.

Group operating loss improved from £281m in 2014 to £182m in 2015, thanks to a better performance from Engineering Services (2015:£8m, 2014:£88m).

In addition, the company suffered losses in its UK construction business due to several historic contracts suffering numerous issues such as schedule slippages and operational deterioration. Overall, total losses were £195m in 2015, a marked improvement from £317m in 2014.

-- Advertisement --

However at the end of 2015, 60% of these projects were already at practical or financial completion, up from 31% as at June 2015. The number of projects at practical or financial completion is still expected to be greater than 90% by the end of 2016.

Mr Quinn said: "We have upgraded the leadership team and set out a clear direction. We are implementing consistent processes to integrate our businesses into a Group with greater transparency and control. Our main markets are providing a positive backdrop, so that with stronger governance we can both win and deliver business on the right terms. Looking to the future, we are investing to maintain Balfour Beatty's expertise and assets.

"By the end of 2016 we will achieve our Phase One targets: our costs are coming down, our cash flow has improved substantially and we expect to reinstate our dividend later this year. Over the following 24 months, I am confident we can reach industry-standard margins. But above all, Build to Last is putting in place the foundations to build a Balfour Beatty with market leading strengths and performance over the longer term."

(LM/MH)