Troubled Carillion boosted by two Network Rail contracts

Infrastructure giant Carillion has been awarded two contracts with Network Rail to upgrade lines in the Midlands.

The company said the first will see it spruce up existing track and infrastructure on the route from London to Corby, which will generate £62m of revenue.

A separate deal through Carillion Powerlines, a joint venture firm, will see work undertaken to complete the electrification of the same route. This contract is expected to generate £260m of revenue over the next three years.

These contract wins will be welcomed by the troubled firm which has had a torrid few months. Carillion, which has about 43,000 staff worldwide, has been thrown into crisis since a July trading update sent shares tumbling by more than 70% in one week.

Big losses 

Earlier this year, the firm also revealed mammoth half-year losses totalling £1.15bn, having been dragged down by a series of restructuring charges.

The profit warning saw former boss Richard Howson step down, with Carillion announcing recently that Andrew Davies is to take the hot seat in April.

Davies is currently the chief executive of Wates Group, where he has held the role since 2014.

Since Howson’s departure, Keith Cochrane has been interim chief executive and has overseen a refinancing and the sale of non-performing assets.

He said of the contract awards: “We are pleased to have agreed these awards with Network Rail, demonstrating that we continue to have the support of key customers and win important new contracts.

“The group faces significant challenges but we remain focused on executing our disposals programme, taking cost out and strengthening our balance sheet.”