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Balfour Beatty expects to sign off on the much-delayed Aberdeen road job this month, and confirmed it is still in talks with Transport Scotland over claims on the scheme.

Running more than a year late due to building work being hit by atrocious weather, the Aberdeen Western Peripheral Route has been completed but contractual wrangling has led to further delays.

In a trading update Balfour said its Aberdeen Roads partnership with Galliford Try was continuing what it called 鈥渁 dialogue鈥� with Transport Scotland on a commercial agreement in relation to associated claims on the job. The pair has previously said delays had cost them 拢4m.

The consortium, featuring the pair and now-bust contractor Carillion, signed a contract to build the bypass back in June 2014 under a lump sum fixed price contract worth 拢533m.

Balfour also said it expected to hit what it called 鈥渋ndustry standard margins鈥� of between 2% and 3% on its UK construction operation in the second half this year.

It was also expecting to report a 拢65m profit from disposals of infrastructure investments throughout the year, including a partial sale of 80% of its Edinburgh University student accommodation PPP project for 拢24m, while the profit margin in its support services operation, which generated around a fifth of its total pre-tax profit in 2017, was said to be improving within its 3% and 5% target range.

The group鈥檚 year-end order book was forecast to be around 拢12bn, 5% up on 2017, while its year-end net cash was expected to be 鈥渂roadly in line鈥� with last year. The average monthly net cash position for 2018 was forecast at 拢185m, ahead of the previous 拢140m to 拢170 million guidance range.

Balfour鈥檚 chief executive Leo Quinn said the business was on track to deliver its Build to Last Phase Two goal of achieving industry standard margins in all earnings-based businesses in the second half of 2018.

鈥淭he actions we have taken since the start of 2015 have created a strong foundation for the future. We have consistently invested in our capabilities, systems and leadership while de-risking the business, strengthening the balance sheet and selectively building the order book.鈥�

Cenkos analyst Kevin Cammack said Balfour Beatty鈥檚 raids on its PPP portfolio would, like last year, give its next set of numbers some extra 鈥渙omph鈥�, but he added that these were 鈥渃hastening times for contractors and it cannot be denied that under Leo Quinn鈥檚 leadership Balfours has been a relative rock鈥�.

Last year Balfour Beatty reported a pre-tax profit of 拢196m on turnover of 拢8.2bn. It plans to publish its annual results for 2018 on 13 March 2019.