Jobs face the axe as Balfour Beatty to shut three sites

The proposals, which along with Doncaster involve sites at Dartford and Rochdale, come as Balfour attempts to turn around its UK construction arm following a profits warning at the end of April.

The three locations currently employ between 50 and 90 people each, although Balfour said it was too early to confirm the number of redundancies.

Balfour said the Dartford site was set to close because of insufficient construction activity and a high cost base, while the two smaller locations in Rochdale and Doncaster are no longer sustainable.

Balfour said it will explore all options for the redeployment of staff affected by the office closures, including across the wider Balfour group.

The three locations account for around eight per cent of the company’s UK regional business, which generated £1.5bn in revenues last year, of a group total of £9.5bn.

Balfour has been carrying out a review of the UK construction business in order to address the issues behind April’s warning that profits will be much lower than expected earlier in the year.

The firm’s review has included exiting mainland Europe, looking at a possible sale of its UK facilities management arm and restructuring its UK regional construction units. Shares in Balfour Beatty, which employs 50,000 people around the world, plunged 11 per cent in April when it issued its second profit warning in six months, prompting chief executive Andrew McNaughton to take control of the UK construction arm.

It has now appointed Nick Pollard, who has been chief executive of Bovis Lend Lease UK and held senior roles at Network Rail, to run the business from June 17.

Analyst Andy Brown at Panmure Gordon said it was positive that Mr McNaughton could now get back to running the group, having appointed Mr Pollard, but added that the latter must focus on improving his unit’s efficiency in the short term.

“Part of the problem they’ve got... is that the work isn’t out there, but that is something they have to deal with... because this is a cyclical industry,” he said.

Mr Pollard said: “I am looking forward to the opportunities and challenges that trading successfully through tough market conditions always brings to construction companies. It will be a privilege to lead that team and help it build a better and stronger business.”

Mr McNaughton said: “Nick’s focus on enhancing performance in mainstream construction, in the UK as well as overseas, combined with his advisory roles for investors and government will be invaluable in bringing fresh ideas to the CSUK (Balfour’s UK construction arm) business and broaden the skills of the senior management team.”