Balfour Beatty ups buyback after profit drop
Balfour Beatty increased the size of its share buyback as the construction group reported a sharp drop in annual profit.
Underlying profit from operations for the year to the end of December dropped to £51m from £221m as equivalent revenue rose to £8.59bn from £8.41bn. Reported pretax profit fell to £30m from £133m.
The FTSE 250 group announced an annual dividend of 1.5p a share, down from 2.1p in 2019, and said it would pay out 40% of underlying profit after tax each year under a new framework. Balfour Beatty increased the size of its share buyback plan to £150m from £50m.
The results showed Balfour Beatty's business recovering in the second half after the Covid-19 lockdown sent the group to a first-half loss. Its order book has increased 15% to £16.4bn and the quality of orders has improved, it said.
The company generated £527m of cash in the year, exceeding its guidance and outstripping the £325m figure for 2019.
Leo Quinn, Balfour Beatty's chief executive, said: "Throughout the pandemic, we have protected the group's strengths, supported our stakeholders and held firm to our disciplines. That we achieved this while exceeding our own targets for net cash demonstrates Balfour Beatty's resilience and the dedication of our people and partners.
"Our leading positions in large growing infrastructure and construction markets, record year end order book and £1.1bn investments portfolio provide confidence in future cash generation. This underpins our new capital allocation framework which demonstrates Balfour Beatty's commitment to deliver enhanced returns to shareholders."
Balfour Beatty shares fell rose 1% to 294.8p at 08:07 GMT.