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Balfour Beatty orders swell as Midland Met deal signed

12 December 2019 | By Neil Gerrard

Balfour Beatty has revealed that its order book is set to swell to more than £14bn by the end of this year, as it emerged that the firm has finally signed a deal to complete Carillion’s stalled Midland Met hospital.

The contractor said in a trading update this morning that its full-year revenue would be around 5% higher than in 2018, when it was £7.8bn.

Meanwhile profit will be “broadly in line” with the £205m it made last year.

Balfour’s order book, which is ahead of the £12.6bn total it reached last year, does not include work won on the HS2 civils or station contracts, which the company said would only be included once the full project was given notice to go ahead.

Margins in its UK construction business are expected to be within the range of 2-3%, with profit in its US arm forecast to increase, with margins of around 1-2%.

Balfour signed a deal to build the 670-bed Midland Met hospital in Smethwick yesterday. The building will now be completed in 2022, with consultant Gleeds advising as NEC4 project manager and supervisor on the development. Balfour already delivered the early works contract in 2018 and will now progress with the main construction works to the 80,000m2 hospital, including the completion of the external façade, and all associated mechanical, electrical and plumbing services, delivered by Balfour Beatty Kilpatrick

Dean Banks, chief executive officer of Balfour Beatty’s UK Construction Services business, said: “This is a key project for the Midlands and a long-awaited moment for healthcare services in the local community. Following the successful completion of the Early Works phase, we are pleased that we have been entrusted to deliver the final elements of the scheme.

“Our wealth of experience and expertise will ensure that the Midland Metropolitan Hospital will service future generations for years to come.”

Richard Samuda, chairman of Sandwell and West Birmingham NHS Trust in charge of the hospital, said: “The people of Sandwell and West Birmingham have been waiting for this hospital for too long, as have our staff who are doing an incredible job delivering health care services from some buildings that are no longer best suited for modern healthcare services. This news cannot come soon enough for those colleagues. Reaching this milestone is testament to the determination of Trust colleagues and leaders in partner organisations, who, with the support of cross-party political leaders, have enabled us to agree this contract to complete the hospital.”

Mike Penny, director at Gleeds, said: “Through the provision of state-of-the-art buildings, the Midland Metropolitan Hospital provides a supportive infrastructure to efficiently meet the demand for current healthcare services across the Black County and Birmingham region. Our long-standing relationship with the NHS, robust track record in the delivery of large healthcare schemes and in-depth understanding of the needs of the sector mean we have been able to support the Sandwell and West Birmingham Trust to achieve its goal of providing fully integrated care of the highest quality.”

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