Sat, 09 Mar 2013 | BUSINESS SALE
Balfour Beatty has confirmed that its mainland Europe rail business is to be put up for sale amid the decision to narrow its focus towards growth markets.
The sales process has already been kicked off, starting with the sale of the construction firm's Spanish business to the company's management.
The announcement that the company plans to sell its rail business came on the same day that the business revealed a seven per cent decline in underlying profit. The 2012 figures showed an underlying profit of £309 million, with a one per cent slide in revenue at £10.9 billion.
While there were some minor downwards adjustments in profit, the report also confirmed that Balfour Beatty's cost-cutting programme is set to save £80 million by 2015. This follows £36 million worth of savings achieved in 2012 at a non-underlying cost of £61 million.
Ian Tyler, chief executive of Balfour Beatty, commented on the financial figures: “We have delivered a set of results for the full year that demonstrated resilience in underlying earnings and a stable order book in the face of continuing challenging conditions in the construction markets in the UK and USA.”
He added that the business has also been making successful progress with the implementation of measures “designed to increase organisational efficiency”. However, it is the business's decision to focus its growth strategy on “key market sectors and geographies” that is reflected in the firm's move towards selling divisions of its business and restructuring its order book.
Mr Tyler concluded: “While we still believe that construction markets in 2013 will be challenging, our actions to date and ongoing strategic focus on growth markets position us well for the medium term.”
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