Balfour Beatty performs in line, Parsons Brinckerhoff integration going well

Construction group Balfour Beatty (LON:BBY) said trading performance had been consistent with expectations for the year as markets remained robust despite uncertainties dealing with government funding of infrastructure investment. It expects the order book at the end of the first half of June26 to surpass the £14.1 billion reported for the end of December 2009.
Balfour Beatty has recently been announced as a preferred bidder on the multi-billion dollar Denver Eagle P3 commuter rail project, in which it will be responsible for a 50% share of the engineering, procurement and construction contract and a 33% share of the operations and maintenance contract. The company stated that the announcement demonstrated the scale and breadth of the projects that it was now capable of delivering following the acquisition of design services group Parsons Brinckerhoff in 2009.
The current year will mark the first full year contribution from Parsons Brinckerhoff, which Balfour Beatty said performed well and in line with its expectations as integration proceeded faster than anticipated.

The construction services also performed well despite a decline in total divisional volumes. Good volumes in UK civil infrastructure and Hong Kong were offset by reduced volumes in most other markets, including the US. However, the order book strengthened since year-end and the group saw what it called “further substantial opportunities across the business".

The performance of the support services business is expected to be weighted towards the second half following the first-half investment in a national operations centre for facilities management customers and a slow start-up of AMP5 contracts in the water/utilities sector.
So far in 2010, Balfour Beatty has achieved the status of a preferred bidder on five projects in infrastructure investments. Barking Power continues to perform well, but its contracts for primary offtake and gas input are set to expire in September, which has led Balfour Beatty to reassess the carrying value of the investment.
The group reported a cash position of £400 million for H1 2010 compared with £224 million in H1 2009.
Shares in the company rose 3% on the update.