Costain Group PLC on Wednesday highlighted a buoyant order book with contract wins across all sectors as it expressed optimism for the future.

In the six months to June 30, the Maidenhead, England-based construction and engineering firm said pretax profit doubled to £17.0 million from £8.5 million a year prior.

Adjusted operating profit rose 8.7% to £16.3 million from £15.0 million with margin of 2.5%, up from 2.3% a year ago. Costain said it was on track to hit adjusted operating profit margin targets of 3.5% and 4.5% in 2024 and 2025.

The profit bump came despite revenue falling 3.4% to £639.3 million from £664.4 million. This reflected growth in Natural Resources, and as expected, a small reduction in Transportation.

Positively, Costain flagged a ‘high quality’ forward work position of £4.3 billion, more than three times 2023 revenue of £1.33 billion. It was also higher than the £4.0 billion forward work position disclosed a year ago.

Shares in Costain rose 4.0% to 98.39 pence in London on Wednesday morning.

Costain reported contract wins across all sectors and ‘significant growth’ in water. At least a further £500 million of water contracts have been won post half year, the firm added.

Costain said: ‘In line with Ofwat’s draft determination, we expect water investment to at least double during the next regulatory period to its highest level for decades and through recent contract awards we are well placed to capitalise on these opportunities.’

Chief Executive Officer Alex Vaughan said he expects ‘further wins for the group in the second half of the year’.

‘The quality and customer balance of our forward work position across our two divisions, together with strong highly visible market investment, gives us good visibility on future revenue and margin. We continue to deliver improvements in the business and remain confident in the group’s prospects,’ he added.

Reflecting this confidence, Costain launched a £10 million share buyback. It left the dividend unchanged at 0.4 pence per share.

The buyback will consist of two tranches, with the first of up to £5 million to start immediately. The second £5 million tranche is anticipated to end no later than March 28, 2025.

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