Infrastructure group Balfour Beatty (BBY) announced it has won a major maintenance deal with Warwickshire Highways. The contract is worth an initial £315 million over nine years, although with extensions it could reach £900 million.
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THIRD CONSECUTIVE WIN
This marks the company’s third consecutive term delivering the Warwickshire Highways Maintenance contract taking it through to 2033 initially. The firm will be responsible for road maintenance, street lighting and public services across over 3,500 miles of roads.
Balfour Beatty will implement an integrated, digitally enabled model with a centrally controlled planning and permit system. This will help gather data as to what needs to be done when planning for winter and reacting to incidents.
‘This award reflects the confidence and trust our customers place in Balfour Beatty,’ said chief executive Philip Hoare. ‘Long term partnerships are critical to the delivery of essential infrastructure, so we can provide better outcomes for communities,’ added Hoare.
This contract is the perfect illustration of why infrastructure is such a good market, in our view. If you build a track record of managing assets effectively and providing value for money, why would customers go elsewhere?
Moreover, these long-term deals provide great earnings and cash flow visibility which allows more returns for shareholders. Balfour Beatty has already announced a £50 million share buyback ahead of its March AGM.
Read the press release here: https://www.balfourbeatty.com/investors/
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