Kevin Cammack's questions to Balfour Beatty plc/ADR (BAFBF) leadership • FY 2016
Question
Kevin Cammack of Cenkos asked what specific factors would drive the US business margin from 1% to 2%, sought clarification on a working capital inflow from provisions, and questioned if profit recognition timing on new business had become more conservative.
Answer
CEO Leo Quinn explained the US margin improvement will come from exiting low-margin 'stick frame' work and focusing on a more concentrated, higher-margin portfolio, particularly in infrastructure. CFO Phil Harrison clarified that the provision movement was related to non-underlying items like sentencing guidelines and asbestos, not contract losses, and that a £50 million cash outflow in 2017 is expected from contract balances, not provisions.