Costain has boosted its order book by £1.5bn, the firm has revealed.
In a trading update this morning (27 January), the civils contractor said its level of activity means it expects to grow its future margins.
The CN100 firm has seen a “substantial increase” of £1.5bn in its “high-quality” forward work position to reach £5.4bn in its 2024 full year, compared with £3.9bn in 2023, it said.
The growth is a result of broadening its tier one customer base and expanding its consultancy services, including on the £4bn BP Net Zero Teesside Power project.
It also named winning a BP FEED contract for a new hydrogen pipeline also in Teesside, as key to its growth.
“[The order book growth], together with growth on existing frameworks and attractive levels of bidding activity, gives the group increasing confidence in its ability to deliver further growth in operating profits and margins,” it said.
Costain topped the December contracts league table, compiled by Glenigan, after it won a £400m job to deliver critical lineside mechanical and electrical systems for HS2.
The update said Costain’s adjusted operating profit for 2024 was in line to meet market expectations of between £41.9m and £43.3m. Adjusted operating profit in 2023 hit £40.1m.
Market consensus is that it will report net cash of £160m when it publishes its full-year results for the year to 31 December 2024 in March.
In the first half of 2024, its turnover fell slightly to £639.3m compared with £664.4m in the first half of 2023.
But pre-tax profit for the six months to 30 June 2024 was £17m, double the £8.5m recorded in 2023.
In the year to 31 December 2023 it posted £1.3bn turnover, down from £1.4bn in 2022. Pre-tax profit was £30.9m, down from £32.8m.
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Ian Weinfass