Costain has announced increased revenue and profits in its half-year results, which it attributed in part to ‘inflation recovery mechanisms’ built into its contracts.
The infrastructure firm reported pre-tax profits of £11.2m for the six months to 30 June, up from £9.1m for the equivalent period in 2021. Adjusted operating profit was £14m, up from £11.5m.
Group revenue was £665.2m, up nearly a fifth (19.5%) on the £556.8m generated in the first half of last year. The vast majority (£494.6m) of this revenue came from transportation, with road contributing £239.2m, rail £219.2m and integrated transport £36.2m.
CEO Alex Vaughan said: ‘In the first half of the year we delivered a strong operating performance reflecting volume increases and the inflation recovery mechanisms built into our contracts.
‘Our adjusted operating profit increased by 22% year-on-year, and we had a strong adjusted free cash performance, ending the period with £95.9m, with a positive net cash flow expected in the second half.
‘Despite material availability and inflation challenges, we have managed the supply chain pressures effectively, while delivering a robust operational performance with new contracts being won on attractive commercial terms with appropriate risk.’
Mr Vaughan noted that in July, the company had experienced a fatality on one of its rail projects.
He said: ‘We are shocked and saddened by this tragic incident and we, and our sub-contractor, are working with the authorities and our client in an investigation to fully understand its causes. We are focused on supporting the family and on the wellbeing of our colleagues.’
