Carillion has announced that it is on track to achieve full-year revenue growth despite a decline in new orders.

The support services and construction group has today reported strong growth in its UK construction activities in the first half of 2015, contributing to a 21 per cent leap in group revenues to £2.26 billion from £1.9bn the previous year, largely due to a high level of contract awards in 2014.

Previous work helped to keep total secure orders around £17bn, down from £18.6bn at the end of last year.

However the contractor suffered a slump in new orders to just £1bn in the first half of this year, down significantly from £3.4bn in the same period last year, something it put down to a pause in public sector contract awards.

While pre-tax profits at the construction group remained flat at £67.5 million, Carillion said underlying profit had grown by 16 per cent after taking account of substantial costs of mobilising new contracts and the expected effect of the margin in construction services trending down towards a more normal level.

Carillion’s net borrowing at the half-year rose to £200m from £177m six months earlier due to business acquisition costs and other investments rather than operating cash flow.

Carillion chairman, Philip Green, said: “I am pleased to report that Carillion has continued to perform in line with expectations, which reflects the actions we took during the economic downturn to position our businesses in markets where we can now achieve revenue growth, consistent with our targets for margins and cash flow.

“We have also made good progress with mobilising a number of major new contracts won in 2014. Therefore, with a strong order book, a growing pipeline of contract opportunities and the prospect of market conditions continuing to improve, our expectations for 2015 and the medium term remain unchanged.”

Revenue from construction services excluding the Middle East (which means UK and Canada) was up 32 per cent to £611.1m (2014 H1: £462.1m) and underlying operating profit was steady at £19.3m (2014 H1: £19.2m).