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Laing O鈥橰ourke has posted stable full-year results, after a decline in profitability in Europe was offset by an improvement in its Australian business.

Reporting its results for the year to 31 March 2014, Laing O鈥橰ourke Group posted total revenue of 拢3.57bn, broadly flat on the 拢3.56bn it posted the previous year.

Group pre-tax profit stood at 拢51.9m, after 拢6.7m in exceptional items, down 9% on 拢57m the previous year.

The exceptional items included 拢3.3m on impairment of land and developments and 拢3.4m of impairment of investment property.

The firm鈥檚 order book dipped 10% to 拢7.4bn, down from 拢8.2bn the previous year.

We are definitely experiencing an improvement in the opportunities now available and in the pipeline

Laing O鈥橰ourke was boosted by an improved performance in its Australian business, which posted total revenue of 拢1.8bn, up 11% on 拢1.61bn last year, with a pre-tax profit of 拢38.7m, up 41% on 拢27.3m the previous year.

The Australian business, which also includes South-east Asia and New Zealand, posted losses in 2011 and 2012, before returning to profit in 2013.

The firm鈥檚 European business posted total revenue of 拢1.96bn - broadly flat on the 拢1.95bn it posted last year - with pre-tax profit of 拢42m, down 16% on 拢50.3m the previous year.

Writing in the firm鈥檚 accounts, Anna Stewart, Laing O鈥橰ourke Group chief executive, but warned the firm was still facing inflationary pressures, particularly on work bid during the recession.

She said: 鈥淚n the UK, we are definitely experiencing an improvement in the opportunities now available and in the pipeline.

鈥淚nflationary pressures and resource shortages are being felt, but these are not immediately translating into adjustments to customers鈥� budgets or bidding prices.

鈥淲e are carefully navigating this risky territory and expect modest work-winning success until the market adjustment is more consistent.

鈥淓ncouragingly, we are seeing improvement across the whole of the country but confidence is still fragile.鈥�

She added: 鈥淎lthough there are signs in some of our markets of an increasing number of project opportunities, they are not consistent across all of our geographies.

鈥淲e expect the next two years to be challenging for our industry and for us, as we complete projects secured in recessionary times while at the same time balancing labour and material price recoveries.

鈥淲e are fortunate that we control much of the costs with our self-delivery model and are less exposed to the external supply chain, but inevitably we will all be affected by inflationary pressures.

Stewart added that the firm鈥檚 shift into factory production left it less exposed to skills shortages in the industry: 鈥淎s the global economy picks up and project opportunities increase, the skills shortage experienced before the financial crisis will soon be felt again acutely.

鈥淲e are confident that following our strategy of Design for Manufacture and Assembly (DfMA), and transferring as many activities away from construction sites into controlled factory environments, will ensure we are less impacted by the skills shortage in traditional trades and will not be driven to engage a lower skilled and inherently less safe workforce.鈥�