Trading Statement

Balfour Beatty PLC
14 January 2004

14 January 2004

                                BALFOUR BEATTY PLC
                                ==================

                                  Trading Update
                                  --------------

Balfour Beatty plc, the international engineering, construction and services
group, is providing this trading update for the year ending 31 December 2003.
The Group's preliminary results will be announced at 7.00 am on Wednesday 10
March.

The Group's trading performance in 2003 was in line with expectations, with good
progress made in the second half of the year. Cash flow was again very
satisfactory and year-end net cash exceeded the half-year position of £104
million after paying for the acquisition of Mansell.

Sectors
-------

Trading in Building, Building Management and Services was in line with the
previous year. A record order book and the acquisition of Mansell should result
in growth in this sector in 2004. In Civil and Specialist Engineering and
Services, performance has improved in 2003, although some recoveries anticipated
during the year in the US are still awaiting final settlement. Rail Engineering
and Services had a strong second half. We do not anticipate that 2004
performance will be materially impacted by Network Rail's decision to take
maintenance in-house. Good progress was made in Investments and Developments
with a first contribution from Metronet at the predicted levels. There continue
to be significant active opportunities for Balfour Beatty in this sector,
particularly in health and education.

Exceptional Items
-----------------

There will be a number of exceptional items in the accounts for 2003, the net
impact of which is likely to be an exceptional profit. These items include
provision for anticipated costs arising from the termination of three Network
Rail maintenance contracts and for some residual liabilities in respect of
BICC's US cables business which was sold in 1999. Profits on the sale of certain
operating assets will also be taken as exceptional.

Outlook
-------

The Group's order book remains in excess of £6 billion, up from £5.1 billion at
the end of 2002. Prospects continue to be encouraging.

                                      ENDS

Enquiries to:
Tim Sharp
Tel: [phone]
www.balfourbeatty.com




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