BALFOUR BEATTY PLC LONDON (Reuters) - British support services firm Carillion (>> Carillion plc) said it was on track for an increase in revenue this year after it posted a strong first half, boosted by contracts won in 2014 and multiple orders secured in 2015.
Carillion, which has won about 15 billion pounds ($24 billion) of work over the past three years, said it expected to win a number of contracts in the second half and meet analysts' forecasts for full-year pretax profit of 175 million pounds.
The company's optimism contrasts with rival Balfour Beatty (>> Balfour Beatty plc), which posted an underlying loss of 135 million pounds in its first half. Carillion abandoned a 3 billion pound merger with Balfour a year ago.
Chief Executive Richard Howson told Reuters he believed Carillion's success was down to its decision to selectively reduce its British construction business during the downturn and focus on government outsourcing contracts.
It won a record number of significant contracts last year, including a 4.5 billion pound joint-venture contract to maintain and upgrade Britain's Ministry of Defence's buildings and for support services to the Ministry of Justice's Southern Estate Prisons.
Howson said the contracts were helping to support the company during the usual pause in public sector contracts awards from government departments after Britain's general election.
"It's actually well timed ... the hiatus in awards from government gives us the breathing room to mobilise these contracts much more effectively this year," he said.
"We fully expect in the fourth quarter to have clarity from the departments on their future programmes, a return to decision making and bidding for central government departments."
Carillion, which maintains railways, roads and military bases in Britain, said first-half group revenue rose 21 percent to 2.3 billion pounds for the period ended June 30 from 1.9 billion pounds a year earlier.
It had said in July it expected to see a return to growth in annual revenue for the first time in five years.
The company said the rise in revenue had been helped by strong growth from its support services division, which posted revenue of 1.2 billion pounds in the first half, and its construction services in the Middle East, Britain and Canada.
Shares in the company were down 1.8 percent at 326.5 pence by 0843 GMT, slightly underperforming the FTSE 250 share index <.FTMC> which was 0.9 percent lower.
(Editing by Kate Holton and David Clarke)
By Li-mei Hoang
