Balfour Beatty today reported it has enjoyed a strong overall performance in the building sector in both the UK and US over the past three months.
In a trading update for the period from 28 June 2009 to 10 November, Balfour Beatty said its balance sheet and general financial position remain strong, with average net cash in excess of £260 million.
The highlight of the period was the £380 million acquisition of US consultant Parsons Brinckerhoff with was formally completed on 27 October.
The acquisition was predominantly funded by a £353 million rights issue.
Balfour Beatty said the acquisition is not likely to have a significant impact on its 2009 results, although its order book has immediately risen from £12.5 billion to £13.7 billion as a result of the deal.
There will also be substantial cash outflows in the first year due to a number of factors, including additional tax charges, the unwinding of certain working capital positions and project settlement costs and the exceptional transaction and integration costs.
A joint integration team has been formed to ensure the smooth transition of Parsons Brinckerhoff into Balfour Beatty and to ensure that the enlarged group maximises the opportunities available to it in the coming months and years.
A statement from the firm to the Stock Market said: “As is well understood, we have businesses in a large number of diverse markets, both geographically and by sector, which operate at different points in the economic cycle.
“Where individual businesses are seeing reductions in their markets, they have taken prompt action to reduce cost.
“In addition, we have taken action across businesses to restructure our UK Rail and Mechanical and Electrical businesses in the period and our highways maintenance business earlier in the year, in order to ensure that we remain as cost effective as possible.
“We remain confident of making good progress in 2009.”