Balfour Beatty’s half-year 2025 results have reinforced its status as a leader in infrastructure delivery, with a performance underpinned by strategic discipline, sectoral alignment, and a surging order book
The results come at a pivotal time for the UK built environment sector, with Government-led infrastructure strategies demanding robust delivery capability and financial resilience.
At group level, Balfour Beatty reported £5.15 billion in revenue, a 10% increase year-on-year, and an underlying profit from operations (PFO) of £77 million, flat against the same period in 2024.
Standout figures include:
- UK Construction is achieving its 3% margin target one year early, recording a 3.6% PFO margin on revenues of £1.56 billion.
- Support Services PFO up 35%, reaching £46 million with a 6.9% margin, driven by energy transmission.
- An 11% increase in order book at constant exchange rate (CER), rising to £19.5 billion.
- Net cash at half year of £1.24 billion, up from £943 million in FY2024.
In the UK, the firm is capitalising on the £725 billion National Infrastructure Pipeline, supporting transport upgrades, energy transition initiatives, and defence estate renewal.
Recent project wins include:
- Net Zero Teesside Power, an £833 million carbon capture gas-fired plant—the world’s first of its kind.
- Sizewell C, where Balfour Beatty will deliver one-third of civils work as part of a £38 billion nuclear investment.
- Rail wins worth £500 million, including CP7 track renewals and fleet supply for Network Rail.
- Significant involvement in Lower Thames Crossing, A66 upgrades, and National Grid’s Great Grid Upgrade.
The most notable shift in HY2025 is UK Construction surpassing the long-standing 3% margin target, driven by portfolio risk reduction, operational performance, and insurance recoveries.
Revenue climbed to £1.56 billion (up from £1.46 billion in HY2024), with PFO hitting £56 million—a 65% increase year-on-year. Crucially, 82% of orders are now on either target cost or cost-plus terms, mitigating fixed-price risk. Public and regulated clients account for 79% of the division’s £6.3 billion order book, providing additional confidence on delivery timelines and payment flows.
Projects of note include:
- HS2 Area North: box-slide completion at A46 and progress at Old Oak Common.
- Hinkley Point C: adit connections completed on nuclear cooling tunnels.
- SCAPE framework projects: delivering local infrastructure under public procurement.
Support services: Power transmission pipeline surges
Support Services—encompassing power, plant, and transport maintenance—has emerged as a growth engine. Revenue increased by 19% to £662 million, while PFO margin increased to 6.9% (from 6.1%), with expectations for full-year margin at the top end of the 6–8% range.
Key drivers include:
- Major wins in electricity transmission: Skye 132kV reinforcement (£690m), Eastern Green Link 2 (67km HVDC cable).
- Framework strength with SSEN, SPEN and National Grid, including tower fabrication for the ASTI programme.
- Consistent order book performance in rail and highways maintenance, boosted by an £8-year tamping fleet supply and long-term CP7 contracts.
- Over 850 staff recruited into power transmission since early 2024
US Construction
US Buildings (92% of revenue) delivered strong growth in both order book and volume, with notable projects including the $385m Grand Hyatt Miami Beach, new schools in Florida and California, and major residential schemes in DC.
US Civils, however, was significantly impacted by a legacy project in Texas, resulting in an £11 million HY loss, and dragging down the overall segment PFO into the red.
To mitigate future risk, Balfour Beatty has ceased bidding joint venture design-build highways projects in Texas and secured a new $889 million project on I-30 in Dallas, designed to play to their historic strengths in standalone highway reconstruction.
The total US Construction order book is now £7.6 billion, reflecting 17% growth at CER, but with expectations moderated for 2025 PFO (c. £20 million full-year).
Infrastructure investments
While this segment posted a pre-disposals £12 million loss, it remains central to Balfour Beatty’s long-term value model. Two new US multifamily housing investments were made in H1 (Florida and Texas), and the total portfolio valuation now stands at £1.16 billion, down 8% due to discount rate adjustments and FX impacts.
With £30–40 million in disposal gains expected for FY2025, and cash distributions of £13 million already realised, the group is maintaining a disciplined approach to value extraction and reinvestment.
In response to Balfour Beatty’s interim results, Michael O’Shea, construction partner at international law firm, Gowling WLG commented:
“Balfour Beatty continues to solidify its position as an industry leader, maintaining a robust order book with numerous contracts secured for its US operations. In the UK, the Rail division is well-positioned to contribute to the future of the country’s rail infrastructure through ongoing work on HS2 and its reappointment to Network Rail’s eight-year Supply Chain Services framework. The recent commitment of £7.2 million towards AI investment further underscores the company’s focus on enhancing productivity and delivering sustained strong margins to investors.
“Looking ahead, any caution shareholders may exercise regarding the forthcoming leadership transition following chief executive Leo Quinn’s departure after more than a decade of providing stability and establishing a solid foundation for the company will be offset by the be confidence in Philip Hoare, Quinn’s successor. He has extensive experience and is in the advantageous position of the company continuing to support continued growth and drive business objectives forward.”
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