Multiplex allows for Wembley job setbacks

SYDNEY - Construction company Multiplex Group has booked an additional A$8.6 million ($9.4 million) after tax provision for its Wembley stadium project in London as it reported a "disappointing" annual result.

Multiplex's annual net profit was up 71 per cent to A$83.82 million.

Multiplex had already flagged losses from its A$1.2 billion reconstruction of London's iconic Wembley Stadium, which has suffered from delays and higher than expected costs.

"The result is very disappointing and has been significantly impacted by the substantial losses experienced at Wembley National Stadium," chief executive Andrew Roberts said.

"Progress since the introduction of an accelerated works program has been encouraging and we remain on program to hand over at the end of March 2006.

"However, despite this, the company has made a further AA$8.6 million after tax provision today as a contingency against residual risks that remain until project completion."

Multiplex also provided guidance for 2005/06 to take into account the transition to international financial reporting standards and a "more conservative methodology of recognising completion bonuses".

The revised forecast is for A$215 million before stapling eliminations and outside equity interests.

The result for the year to June 30, 2005 was impacted by a A$62 million loss in Multiplex's construction division.

However the development division achieved a A$95 million profit, while property funds management contributed A$16.5 million, with facilities and infrastructure management contributing A$4.1 million.

Multiplex also announced it had sold half of its 50 per cent interest in the Cricklewood urban regeneration scheme in the United Kingdom.

Mr Roberts said this was consistent with Multiplex's stated strategy to rationalise its development pipeline, reduce its exposure to long dated projects and introduce new partners or co-investors.

The sale enabled an A$8.6 million profit to be recognised in 2004/05.

On an underlying basis, the group's net profit was A$148.1 million before stapled eliminations and outside equity interest.

This comprises results from both the company and the trust that staple together to form the Multiplex group.

The result included a A$165.4 million contribution from Multiplex Property Trust, which looks after the property investment side of the business.

The company side of the business, Multiplex Ltd, which includes the construction division, had an after tax loss of A$17.3 million.

Total group revenue for the year increased by 24.4 per cent to A$4.15 billion.

Multiplex declared a final dividend of 14 cents per stapled security compared to 12.63 cents previously.

- AAP