Costain has reported strong growth in its energy business for the first half of 2025, as the division posted a 36% jump in revenue to £29.6million, underpinned by new contract wins in carbon capture, hydrogen and grid infrastructure.
The company’s Natural Resources division – which includes water, energy, defence and nuclear – increased overall revenue by 7.3% to £209million and nearly doubled operating profit to £16.1million, lifting divisional margins to 7.7% from 4.3% a year earlier. Energy was the standout performer, benefitting from the UK’s push to decarbonise its energy system.
Key wins in the period included the start of delivery for bp’s flagship Teesside carbon capture and storage scheme and two front-end engineering design (FEED) contracts with Storengy UK to support a pioneering underground hydrogen storage facility in Cheshire.
The company highlighted “strong future growth” in large-scale energy switching projects, including hydrogen generation and transportation, as well as grid upgrades and gas network resilience. It cited Ofgem’s £80bn RIIO-3 investment programme – four times the size of the current regulatory cycle – as a major opportunity.
Alongside its energy transition activities, Costain continues to play a critical role in energy connectivity. Its long-term framework with Cadent has already delivered new gas mains and services to 27,000 homes and replaced 335km of network across eastern England.
Nuclear energy was also a growth driver, with Costain securing a 10-year framework with Sizewell C to provide engineering and project delivery expertise for the new nuclear power station. The group added Urenco as a new customer, winning contracts for new infrastructure at its Cheshire site and for Europe’s first commercial-scale high-assay low-enriched uranium facility – expected to provide fuel for small and advanced modular reactors under the UK’s Great British Nuclear programme.
Chief executive Alex Vaughan said the strong first-half performance reflected “improving quality of contracts and execution” and pointed to the government’s 10-year Infrastructure Strategy and regulatory determinations in energy as clear signals of sustained investment.
Costain’s forward order book across the group grew to £5.6bn, more than four times its 2024 revenue.