It seems to me that the collapse of Carillion takes out a major competitor. There is now the possibility that bidding for contracts will be less cut-throat in the future. I think that BBY may profit from this mess.
Another brilliantly useful post from Ripley. Can't remember if he owns the share, can't remember the failed bid from Carillion, can't even spell either Carillion or 'topped' and brags about 'topping up' just before BB's JV partner goes well and truly bust, leaving a £45 million loss for BB to fill.
Could recall if i held this share ( W ) more transferred in .
Do i recall correctly these being in trouble a couple of years back and Carrillion making an offer ?
They are the biggest construction group carrilloin ( if they survive today the second )
" THE FTSE (FTSE:UKX) Usually, the festive period is a "feet up" time with stock markets making pretend movements, designed to conceal prices actually being marched on the spot. Gleefully, we take full advantage of Scotland enjoying the 1st & ..."
A short but sweet full-year update from Balfour Beatty (BALF) has reinforced Numis view that the infrastructure group offers strong recovery potential.
While the update declared the group was trading in line with expectations, analyst Howard Seymour took heart from the positive tone.
Body language about confidence to attain industry standard margins and further increase balance sheet strength are both important and further illustrates why share price weakness on the back of Carillions woes is illogical, he said.
We retain the view that Balfour has the strongest recovery potential in the sector couples with balance sheet strength, which makes it a key pick on a recovery basis in the construction sector in the coming year.
Seymour rates the shares a buy on a 350p target price.
"It's never easy to spot where the next profits warning or company alert is coming from, which is why analysts at Liberum have come up with a red flags checklist that might help.Until now, this has been limited to top-flight companies based on 13 ..."
I was under the impression that BB were actually internally struggling to post this result - i wonder what coffers have been raided to do this and have they actually put off the bad news for another day - under no circumstances was Leo going to the city with another loss????
"Hard evidence from LSE:BBY:Balfour Beatty that its turnaround remains on track helped to ease investor nerves on Wednesday after recent profit warnings elsewhere in the UK construction sector.The @GB:MCX:FTSE 250 stock has moved sideways in ..."
Balfour Beatty got a boost as Bank of America Merrill Lynch upgraded the stock to 'buy' from 'neutral' and lifted the price target to 345p from 295p, citing improved confidence in US, UK and Hong Kong margin recovery.
One of the more overvalued shares in the FTSE 250, it's difficult to justify a forward P/E of over 25 wth meagre final profits forecast. We've seen this all before with BBY. Loads of big contracts trumpeted, then the sp shoots up once a year on wildly optimistic noise, only to disappoint inevitably. This time it will be different (of course).
"Recovering infrastructure group LSE:BBY:Balfour Beatty has restarted dividend payments after taking an 18-month break to focus on a major turnaround programme. Balfour isn't in the clear yet - there is much still to do - but with little impact ..."
Balfour Beattys win of a $697 million (£524 million) railway electrification contract in California cheered analysts at Liberum Capital.
Liberum reiterated its buy recommendation and 270p target price for the struggling construction group, which cut its dividend earlier this year as part of a recovery plan under chief executive Leo Quinn.
The contract to electrify the 52-mile Caltrain corridor between San Francisco and San Jose is Balfours largest in the US to date. It is a reminder that Balfours has a large and profitable US construction business, which is larger than the UK construction business and is growing faster, even in constant currency, Liberum said.
Balfour is due to report half-year results today which Liberum expects to be awful with a loss before tax of around £25 million driven by losses in the UK and Middle East.
However, we continue to see deep value in the PPP [public-private partnership] business. Balfours trades on a recovered CY [calendar year] 18 P/E of 9.8x or 2.8x excluding PPP. We view the purchase of £200k of shares by Leo Quinns wife in June as encouraging, the analysts said.
Balfour Beatty (BALF) shares gained 3.6p, or 1.5%, to 244.6p. They have fallen 9.5% this year."
I think so, not just this share but many others also. One reason is that uncertainty has been removed with the appointment of a new PM. Who it is probably didn't matter as much as the issue being resolved now rather than in 3 months time.
Growth potential at Balfour Beatty (BALF) coupled with a rising portfolio value means the construction company has the strongest profit profile in the sector.
Numis analyst Howard Seymour retained his add recommendation and target price of 294p on the shares, which rose 1.3% to 251.9p yesterday.
We remain convinced of the growth potential of the investments business in value terms, and expect disposal profits to reduce over the coming years which will improve the underlying portfolio value, he said.
Services recovery is clearly the major driver of the shares, however. 2015 services losses reflected the acceleration of management actions to eliminate legacy issues in our view, and this coupled with existing tangible cost and cashflow benefits will progressively provide Balfour with the strongest profit recovery profile in the sector. "
Construction company Balfour Beatty (BALF) is expected to return to profit this year despite UK losses.
Numis analyst Howard Seymour retained his add recommendation and target price of 290p. The shares fell 2.5% to 252.7p yesterday.
UK losses were always going to be the key feature of results, but we believe the tangible management progress on costs and cash performance set the scene for movement back to profit in 2016, he said.
We contend that the majority of legacy issues will be eliminated this year, and outline here our 2018 estimates which are driven by management initiatives to give Balfour the strongest recovery profile in the sector. Meantime the ongoing value of, and investment in, the public private partnership portfolio continues to provide strong underpinning at the current share price. We therefore expect a progressive re-rating from special situation to recovery stock for the company in an industry which is only at the start of the upturn in terms of government investment and industry recovery. "
Balfour Beatty's joint venture with Morgan Sindall and BAM Nuttall has been awarded a £416m contract to construct part of London's new 'super sewer', the Thames Tideway Tunnel, for Bazalgette Tunnel.
The Thames Tideway Tunnel will ensure the capital's sewerage system is fit to support its projected population for at least the next 100 years, and will tackle the issue of discharges of untreated sewage that currently enter the River Thames on a regular basis.
Balfour Beatty's three-way equal joint venture, which is known as BMB and was appointed as preferred bidder for the scheme in February 2015, will create the six kilometre 'West' section of the 25km Thames Tideway Tunnel. BMB's 'West' section will run from Acton in West London to Wandsworth in South West London and will incorporate seven separate work sites along the route. Works will include design, construction, commissioning and maintenance for a two to five year period following construction completion.
A digital construction approach utilising Building Information Modelling (BIM) will allow full testing and simulation of construction activity before works start on site for safe and efficient delivery.
Project materials will be transported down the River Thames to ease road congestion, emissions and disruption throughout the duration of the project.
Without any explanation from Network Rail or Balfour Beatty, I wonder why by MUTUAL CONSENT the contract has been terminated - although BBY will be retained for design services.
The termination of the existing contract was apparently the result of frequent delays but no reasons have been given for them..
Having regard to the changes being made by Leo Quinn and the recent rises of BBY shares,
and the seemingly bland announcement, I believe we need some clarification of the announcement and to which party one can attach elements of blame.
"The Questor Column:
Questors worst share tip makes progress:
Balfour Beatty has something of a problem. While it would like to draw a line under loss-making contracts and reassure investors that the turnaround is on track, in the notoriously tricky world of construction it simply cant offer those assurances. From the home kitchen extension to the multi-billion-pound national infrastructure project, there is always an element of finger in the air when working out how much the materials, manpower and expertise will cost. Balfour Beatty has become something of a poster child for the sectors woes. The previous management team has been culled following a string of profit warnings, Balfour was nearly taken over by rival Carillion last year and the dividend was axed in March this year. Balfour has plenty of qualities to ride out the storm.
Under Mr Quinn a focus on cash led to an inflow of £362 million in the first half, leaving a £260 million cash pile on the balance sheet at June 26. The business is focusing on cutting costs and made £25 million in savings during the first six months with a total target of £100 million by the end of next year. Mr Quinn is tentatively optimistic on the outlook. There are some big projects on the horizon such as HS2, British nuclear and tenders for a potential new runway at Heathrow. The order book is stable, down slightly from £10.4 billion to £10.3 billion at the end of June.
Balfour Beatty has been one of Questors worst share tips, having recommended them at 273p in October 2013 and again at 293.5p January 2014, on early signs of a recovery it has been a rollercoaster ride. Weve learnt our lesson and until trading is solidly profitable and dividends return it remains a hold.
Balfour Beatty at 261.6p+9.9p. Questor says Hold"
"If the market senses that this is really the last warning, the shares could actually move up materially."
If we belive what we are told, we are at the beginning of transformational changes at BBY. In difficult waters, a cruise ship is hard to turn. However, once the Captain has the liner on a new course the outlook could be much better.
Nice 4% climb today, but let's see how the SP reacts in the medium term !
The large loss expected to be reported in Balfour Beattys (BALF) interim results on Wednesday is not deterring Liberum from its buy stance on the construction company.
Unusually for us, we have no interim earnings estimate over and above the certainty that there will be a large reported loss, it said.
There is every chance that there is another downgrade to reflect further prudence on areas already reviewed, or a fresh look at the Far East business, where we are aware of problems, it added.
However, the fact that the shares have increased 10% since the [profit warning last month] makes it difficult to know what can make the shares go down. If the market senses that this is really the last warning, the shares could actually move up materially.
Liberum has a 285p target price on Balfour Beatty, which rose 1.4% to 245p yesterday."
and 1 month later, the SP is up 10% at 240p. We bought in at 180p when Leo Quinn's arrival was announced from QQ.
With a "Self help" strategy to turn this business around, and sort out the "legacy" issues, we can give a little more time than the 9 months to-date.
Happy with the progress so far, and with rumors of Chinese interest, more than happy to hold.
Balfour Beatty has issued another profit warning, with pre-tax profit likely to be lower by between £120m to £150m due to problems discovered in various parts of the infrastructure construction group as part of a continuing business review.
The troubled FTSE 250 outfit, which has reported six profits warnings over the past two years, said "legacy issues" had been discovered in its UK, US and Middle East businesses, with two-thirds of the profit shortfall stemming from the UK.
Read more: Chinese construction giant said to be eyeing up Balfour Beatty
"The issues we are working through are as I set out in March and legacy challenges remain," said chief executive Leo Quinn. "However, we are making encouraging progress on the group's transformation. The positive response of our people to change, the continuing confidence of our customers in Balfour Beatty's expertise and the first signs of improving cash performance reinforce my conviction in the group's long-term success."
On the upside, good progress was said to have been made against the £100m cost reduction programme.
Quinn's transformation programme has seen new project disciplines and financial controls embedded into company culture via a new senior leadership team that is now mostly in place.
Helped by this new discipline, net cash is expected to exceed £200m at the half year end, which Quinn said demonstrated the group's ability to maintain balance sheet strength through self-help.
In March, Balfour's troubles in its UK construction business forced it to suspend its dividend, with a £304m pre-tax loss reported for 2014 and negative operating cash flow of £372m. The group slumped to a total loss of £59m in 2014 on revenue of £8.4bn.
At the time, Balfour wrote down further £118m on problem contracts in UK construction as its auditors found out that the firm undertook low margin contracts and then managed them poorly.
The market was not impressed, with the shares tanking in the first few minutes after the stock market opened before rebounding to be down 3.5% to 220.4p by 08:25 on Thursday.
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