Carillion sees more future PFI work in education and prisons

Carillion has issued an upbeat trading statement for the first six months and indicated that PFI work is starting to pick up after a general slow-down this year.

Meanwhile the company said it expected its order book to remain at a record £16bn.

In a conference call this morning, chief executive John McDonough said the company had enjoyed a good first half and had ‘very good’ prospects for the coming six months.

On PFI, the company confirmed general suspicions that the sector was slowing, especially in health, but indicated that more education and prison work was feeding into the pipeline.

“PFI remains good, if lumpy. We will bid for Bristol’s £300m hospital PFI and we are shortlisted for three Building Schools for the Future (BSF) schemes.

“In addition, prisons is a sector that’s bubbling back. We are shortlisted for a prison in Scotland and we expect the launch of the two PFI prisons in England in a year’s time and probably more after that.”

“The UK remains very strong across the board, the Middle East is also very strong and opportunities in Canada are increasing as PFI takes off,” McDonough said.

He also indicated that Mowlem’s integration into the business was running according to plan, and said he was confident that it would deliver a £26m saving by the end of the year.

Net debt was almost £150m, up from £108m in the six months before, but the company said it continued to focus on strong cash management and hoped to bring debt below the £100m mark by the end of the year.