Billington Holdings Plc (LSE:BILN) has lowered its profit expectations for the year ending December 31, 2026, following a reassessment of project costs and delays affecting the recognition of revenue and profits from certain contracts.
The structural steel and construction safety specialist now expects underlying profit before tax of between £4.0 million and £5.5 million, below market expectations of £8.3 million. The company reported underlying pretax profit of £4.1 million in 2025.
The revised outlook reflects weaker profitability on an industrial construction project, delays to a major bridge contract and updated assessments of expected contributions from other projects.
Industrial Project Costs Weigh on Profitability
Billington reported difficulties delivering an industrial sector project in northern England, with execution proving more challenging than originally anticipated.
Following a reassessment of the costs required to complete the work, the company expects a material reduction in the contract’s profit margin.
Separately, client-related delays to a significant bridge project being undertaken by its Tubecon business have pushed the expected profit contribution into 2027.
Billington also noted that the recognition of certain contract profits remains subject to a final assessment after the financial year ends.
Depending on the outcome, the company said its full-year underlying pretax profit could be towards the upper end of its revised guidance range.
Record Order Book Supported by £120 Million in Contract Awards
Despite the reduction in near-term profit expectations, Billington said trading across its wider operations remained positive.
The company has announced new contract awards worth approximately £120 million during 2026, covering projects in data centres, energy, infrastructure, education and defence.
These contracts have contributed to a record order book, providing visibility over workloads throughout 2027 and, for certain projects, into 2028.
Billington said its focus on higher-value projects, alongside investments in operational efficiency and expanded capabilities, continued to support performance across the business.
However, the wider structural steelwork and construction markets remain challenging, with pricing pressure affecting industry conditions.
Strong Balance Sheet Supports Longer-Term Outlook
Billington said it continues to maintain a strong balance sheet, providing financial flexibility to deliver its secured contracts and invest in additional capacity.
Management remains focused on project execution, cost control and operational improvements as the group works through its record order book.
Although the board expressed disappointment with the reduction in expected profitability for 2026, it considers the issues responsible for the downgrade to be specific to individual contracts rather than indicative of broader operational weakness.
The company said its secured workload, market position and pipeline of potential new projects continued to support confidence in its longer-term prospects.
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