Multiplex's fifth profit warning

SYDNEY - Multiplex Group said mounting losses from building London's new Wembley Stadium will cut earnings by two-thirds this year, sparking a slump in its shares, Australia's worst-performing property stock.

Multiplex shares lost 8.4 per cent, or 29Ac, to close at A$3.16 after cutting its group profit by A$165 million. The stock touched A$3.04, its lowest level in more than two months and registering its biggest single-day percentage loss in about seven months.

Yesterday marks the fifth time this year that the company has said losses at Wembley will be higher than previously forecast.

The shares have plunged 42 per cent this year.

Profit will fall to about A$50 million ($54 million) in the year to June 30, 2006, compared with A$148.1 million the previous year, the Sydney-based company said. Multiplex had forecast a profit of A$215 million as recently as last month.

The 90,000-seat stadium has been beset by a dispute with contractors and surging costs, leading the company to lower its profit forecast five times this year. Multiplex founder John Roberts quit in May and his family, which controls the business, covered A$50 million of losses.

Multiplex said last month the steel bill for Wembley, the most expensive sports stadium in the world, may be 25 million ($64 million) more than previously forecast.

The stadium will cost 757 million, five times the initial forecast. Multiplex says construction is on target to allow the FA Cup final to be played at Wembley on May 13.

The London-based Football Association says it needs two months after building ends to prepare Wembley for the Cup final.

The governing body has Cardiff's Millennium Stadium on standby for the showpiece. Multiplex yesterday said it will start handing over the stadium in January.

- BLOOMBERG