The UK’s largest building company says it expects its full-year UK profits to be £50 million below expectations – and blames weak conditions in the construction industry.
Balfour Beatty said in a statement that the UK is now a “challenging” place to do business.
Official figures released last week highlighted a big slowdown in the building sector. The Office of National Statistics GDP figures for the first three months of 2013 showed that UK construction activity fell by 2.5 per cent.
In a trading update, Balfour Beatty said: “The UK construction market has been a challenging environment in which to win and execute work. Market conditions which deteriorated significantly in the second half of 2012 continue to be difficult.
“Our subcontractors continue to operate under considerable financial strain. In these extremely tough conditions, our UK construction business has been concurrently implementing a substantial organisational restructuring in order to streamline the business for future success while reducing costs to remain competitive.”
Balfour said chief executive Andrew McNaughton, who took over last month, would personally take charge of the UK construction unit to address the challenges facing the industry.