Carillion pipeline boosted by Canada, UK councils

Wed Jul 4, 2012 2:58am EDT
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LONDON (Reuters) - Support services and construction firm Carillion said its pipeline of potential work had grown to 35 billion pounds ($54.87 billion) in the first half of 2012 as British local authority work and private finance projects in Canada increase.

The group, which maintains railways and military bases and has a strong construction presence in Canada and the Middle East, said it remained on track to meet full-year expectations but as expected first half revenue would be lower than in 2011.

Carillion said the reduction was mainly down to its decision to shrink its UK construction business as it combats slowing market conditions, as well as much of its Middle East work being second-half weighted.

It said its order book was now worth 18 billion pounds, while its bid pipeline of potential work had risen from 33 billion pounds in February to 35 billion pounds.

The group said it expected major bidding activity in Canada this year and in 2013 as private finance projects increase, driven by a C$35 billion program in Ontario, while in Britain it expected to win more work from councils battling budget cuts.

Carillion said it remained on track to grow annual revenues to around 1 billion pounds in both Canada and the Middle East by 2015.

Shares in Carillion closed at 282.1 pence on Tuesday, up 10 percent on a month ago, valuing the business at around 1.2 billion pounds.

(Reporting by Neil Maidment; editing by James Davey)