City takes the view that Hatfield crash is a one-off event for which the contractor had already set aside funds
Hatfield: Balfour has survived the fallout
Balfour Beatty鈥檚 shares held firm last week despite its 拢10m fine over the Hatfield crash.
The result was widely expected and the City had discounted its impact. Shares were roughly unchanged at 312.5p at close last Friday.
Howard Seymour, an analyst with Bridgewell Securities, said: 鈥淚t has happened and it is a very big number but this is an exceptional, one-off cost that does not affect underlying trade.鈥�
He added: 鈥淭he trouble is that it is a very emotive issue so the simple fact for Balfour Beatty is that it gets it out of the way. It won鈥檛 hit their numbers because there will have been an element of provision.鈥� A spokesperson for Balfour Beatty confirmed that this was the case. He said: 鈥淲e tend to make provisions for things that might happen.鈥� He would not disclose how much the company had set aside in its account but said that it had 鈥渁lready taken the pain鈥�.
Charges of corporate manslaughter brought against the company were dropped in July but Mr Justice Mackay described its role in the crash as 鈥渙ne of the worst examples of sustained industrial negligence鈥�.
It is a very emotive issue. The simple fact for Balfour is that it gets it out of the way
Howard Seymour, analyst
Balfour Beatty said that it accepted that there had been inadequacies in its patrolling and inspection activities, for which it apologised. But it noted that 鈥渢hat the accident arose as a result of a systemic failure of the industry as a whole".
Another spokesperson said: 鈥淎t no stage did Balfour Beatty Rail Infrastructure Services work outside the industry standards on patrolling and inspection as they were constituted before the accident. The health and safety of the public and of its employees is paramount in everything that the company does. The company will be considering the judgment in detail.鈥�
Balfour Beatty, which has a total capitalisation of 拢1.3bn, made a pre-tax profit of 拢257m in the financial year ending 2004 after goodwill and exceptionals, an increase of 118% on the previous 12 months, when pre-tax profit was 拢118m.
Network Rail, the successor to Railtrack, was given a 拢3.5m fine for its role in causing the accident, which killed four people and injured 102.
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