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Costain鈥檚 profit rose by 7% over the past six months despite scheduling changes at HS2 contributing to an 18% fall in turnover.

The firm reported pre-tax profit of 拢18.2m, up from 拢17m in the same period last year, while its operating margin jumped from 2.5% to 3.2% and is expected to hit its run-rate target of 4.5% in the second half of the year.

But the half-year results have been dampened by a sharp decrease in revenue from the firm鈥檚 transport division which saw income fall 29% from 拢444m to 拢316m and operating profit almost halve from 拢13.8m to 拢7.3m.

Costain attributed the lower figures to road contracts completing with turnover from the highways sector diving 53.2% in the first half of the year. Projects completed during the period include the A30 dual carriageway in Cornwall and the M6 Junction 21a-26 smart motorway upgrade.

A 23.2% fall in rail revenue from 拢176.4m last year to 拢82.5m in the first half of this year was blamed principally on rephasing of HS2 following a reset of the project by chief executive Mark Wild, who was appointed last year to bring down costs.

But Costain鈥檚 other sectors were more successful with revenue from integrated transport up almost 80% from 拢27m to 拢49m, driven by growing volumes of work at Heathrow airport, while turnover from the energy sector rose by 36.4% to 拢30m.

The firm鈥檚 defence and nuclear energy division also saw an improved performance with turnover edging up 13.6% from 拢53.5m to 拢61m. Nuclear is considered a significant growth sector, reinforced earlier this year by the firm clinching a place on a 10-year framework with Sizewell C to provide engineering and project delivery services.

Costain chief executive Alex Vaughan said the firm is also considering entry into the rapidly growing datacentres market, saying if clients 鈥渨anted to have strategic long term investments, that might be something that we would look at鈥�.

The results set out a forward work position of around 拢5.6bn, up from 拢4.3bn at the full year, more than four times the revenue earned last year. 

Vaughan said the firm is on track to see a 鈥渞eal step change鈥� in in revenue, operating profit and margin in 2027 as further projects linked to the government鈥檚 10-year infrastructure strategy get under way.

He claimed the business was in 鈥渢he strongest position it has been in for years,鈥� adding: 鈥渨hen you step back and you look at the market outlook, it鈥檚 incredibly positive, significant investment across all of our markets, transportation, water, energy, defence and nuclear energy, and it鈥檚 all happening now鈥�.

He blamed the fall in transport revenue on a 鈥渢iming differential鈥� which he said would be offset by new roads contracts starting next year and delayed HS2 work getting started around 2027.