Balfour adopts selective bidding strategy after posting further major losses
Balfour Beatty is downsizing in London after suffering losses on major projects in the capital, chief executive Leo Quinn has told 黑洞社区.
Speaking after the firm posted further heavy losses this morning, Quinn said Balfour was adopting a more selective bidding strategy 鈥� including scaling back its London business and competing for fewer small jobs.
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Commenting on the firm鈥檚 London operations, Quinn (pictured) said: 鈥淚n the London area we are reducing, where we have suffered losses on key projects.
鈥淲e ended up with too much business in London and didn鈥檛 have the resource. It鈥檚 now about matching our risk capability with our level of business.鈥�
Despite problems in the capital, Quinn said Balfour鈥檚 strategy was still to pursue major, complex projects in the city and elsewhere, with the prospect of higher margins: 鈥淲e still want to be taking on premier engineering jobs [鈥 We will be doing more and more of these.鈥�
Instead, Balfour is reducing the number of small jobs it takes on, Quinn said, adding: 鈥淭he cost of bidding [small] jobs and making a return means it鈥檚 sub-economic鈥�.
Quinn said Balfour had ramped up its checks on bids to try and swerve problem jobs: 鈥淓ach step of the way we are monitoring and tracking. We have real time control.鈥�
Quinn declined to name London projects where Balfour has suffered losses, but problems have been reported on several in recent years.
For instance, Balfour requested more money from clients on both the conversion of the Olympic Stadium for West Ham football club and a hotel project next to the O2 Arena; . However, 黑洞社区 has no information to suggest either job is loss-making.
Quinn said the firm was 鈥渉alfway through鈥� the first phase of its turnaround programme to the end of 2016, when 90% of its problem legacy jobs will have completed.
He said: 鈥淲e have made fabulous progress. But it鈥檚 far too early to declare victory. We鈥檝e put a huge amount of work in towards transformation. We are going from strength to strength.鈥�
鈥淔or where we are, what we have achieved is truly astonishing. We鈥檝e been around for 100 years and this is about ensuring we鈥檙e around for another 100.鈥�
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