Carillion predicts profits rise as order book hits £16bn
Carillion is still expecting to increase its operating profit this year despite a slowdown in orders following the Brexit vote this summer.
A full-year trading update from the Wolverhampton-based construction and services group, said its order book was worth £16 billion – slightly down on last December's figure of £17.4bn.
The company – which employs around 600 of its 46,000-strong workforce at its city centre headquarters – said that after "a strong work winning performance in the first half of the year", with £2.5bn of new and probable orders, the pace of new orders had slowed in the second half.
"We believe this is due in part to the changes within UK Government Departments following the EU referendum result, as they reassessed their spending priorities ahead of the Autumn Statement, and to the slower pace of contract awards in the Middle East, particularly in Oman, as a result of the prolonged low oil price. "
As a result, total new orders were expected to reach £4.5bn by the end of the year. And, said the company, "We expect total operating profit to increase as a result of strong revenue growth."
Services now accounts for two thirds of Carillion's workload across the UK, Canada and the Middle East and the company expects this to keep increasing. But it continues to winning work on major public-private partnership (PPP) schemes such as the £350 million Midland Metropolitan Hospital, currently being built at Smethwick.
The company also welcomed the Government's Autumn Statement and its commitment to investing in economic infrastructure - Carillion is a market leader in work on highways, digital infrastructure and railways which generate more than £1bn of its revenue every year.
Meanwhile Carillion has been chosen as preferred bidder for a £120 million power transmission contract in Canada.
Its Canadian business, Rokstad, has been selected by Manitoba Hydro for the next phase of its Bipole lll high-voltage transmission line project to deliver renewable energy to Southern Manitoba.
The project involves clearing rights of way, installing access roads, foundations and anchors, assembly of towers and stringing cables along 860 miles from Keewatinohk in Northern Manitoba and ending at Sandy Bay Ojiway First Nation in Southern Manitoba.
Work is due to start before the end of this year, completing in 2018.
