In an interim management statement, the firm said a full order book for its rail sector was making up for a downturn in the plant and freight business.
Jarvis executive chairman Steven Norris said: “The continued strong demand for our rail services is encouraging.
“However, the challenge will be to minimise the impact of the weaker demand experienced in the container freight and transport businesses and the significant increase in fuel costs, all of which we now expect to continue for the remainder of the financial year.”
Included in Jarvis’ rail contracts is the £40 million extension of the Rugby Station remodelling contract, which is due to be finished in December 2008. The firm has also started work on the Airdrie to Bathgate scheme in Scotland and has secured the second phase of the Glasgow Airport Rail Link project.
Revenues in plant were impacted by lower demand for transport vehicles hires and in freight by a reduction in freight container imports. Both plant and freight margins were reduced as a consequence of higher fuel costs.