Cimic Maintains Fiscal Year Guidance Despite Financial Hit From Troubled Tunnel
December 16 2021 - 5:26PM
Dow Jones News
By Stuart Condie
SYDNEY--Cimic Ltd. maintained its full-year guidance despite
forgoing profit margin on a troubled multi billion-dollar tunnel
project in Australia's Victoria state.
The engineering and construction group on Friday said it had
reached a settlement following a dispute over a cost blowout at the
West Gate Tunnel project. Cimic said the total contract value of
the project to its 50-50 joint-venture with China Communications
Construction Co.-owned John Holland had increased to 8.57 billion
Australian dollars (US$6.15 billion) from an original contract
value of A$4.99 billion.
Cimic said its JV has agreed to reduce its revenue from the
project by A$600 million and to forgo profit margin. It expects the
financial impact of the settlement and other project risks to be
offset by existing provisions and other non-recurring gains.
Cimic maintained its net profit guidance of A$400 million-A$430
million for 12 months through December.
Write to Stuart Condie at stuart.condie@wsj.com
(END) Dow Jones Newswires
December 16, 2021 17:11 ET (22:11 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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