German contracting giant Hochtief has warned that losses for the last financial year will hit €160M (£134M) after suffering major problems in Australia and the Middle East.
The contractor’s Australian subsidiary Leighton was badly hit last year by problems on its Brisbane Airport rail link and Victoria desalination projects. Leighton was also hit by problems with its investment subsidiary in Dubai. Earlier this month the firm revealed that the issues combined would cost it around £75M.
The firm also said it would take a £30M hit from “special termination rights” exercised by former board members.
It said that as a result it now anticipates making a pre-tax loss for the year ending 31 December 2011 of around £109M and a net loss of £134M. Previously it had estimated pre-tax losses to be in the “low double digit million euro range”.
Chief executive Frank Stieler attempted to draw a line under the year and focused on 2012. “We thus complete a year in which we have handled many changes and burdens of the past,” he said. “This is reflected in the financial statements. At the same time, Hochtief has proven its excellent market position by a very high volume of new orders in the fourth quarter.”
Work in hand at the year end stood at £40bn, he said, adding that the firm expects to return to profitability this year.