Photo: Ryan Remiorz, The canadian Press
The SNC-Lavalin Group warned on Monday that its results for the year 2018 full will be lower than expected.
SNC-Lavalin has warned on Monday that its results for the year 2018 would be lower than expected, reminiscent of the issues surrounding a project in its mining and metallurgy sector, as well as “business challenges” in the Middle East and also in saudi Arabia.
This news has scared off investors, as on the Toronto stock Exchange, in the morning, the action of the engineering firm abandoned 11,04 $ 22,76 per cent, to trade at 37,46 $.
The multinational, based in Montreal indicated that the contract in question had been granted in 2016, and that the performance was not at the rendezvous, which will have a “significant impact” on its performance in the fourth quarter.
“This isolated incident is unacceptable and I intend to take the necessary measures to reduce the financial consequences for the company “, stated in a press release, the president and chief executive officer of the multinational company, Neil Bruce.
This adds to the deterioration of diplomatic relations between Canada and saudi Arabia, which means that it is impossible to” ignore “the deteriorating outlook in the short term,” says SNC-Lavalin.
Nearly 15 percent of the workforce of a company established in Montreal, which has over 50,000 employees across the world, is located in saudi Arabia.
SNC-Lavalin intends to recognize an after-tax charge to $ 1.24 billion, or 7,06 $ per diluted share related to the activities of its oil and gas sector. For the year ended December 31, the company expects that the benefit is adjusted by action of its engineering activities and construction varies between $ 1.15 per share and $ 1.30 per share.
For its part, the adjusted earnings of the company should vary in a range between $ 2.15 per share to $ 2.30 per share.
In November, the forecasts of SNC-Lavalin group reported an earnings per share 2.60 $ 2.85 $ related to its activities of engineering and construction, then that benefit is adjusted by action must vary between 3.60 a $ 3.85 $.
In Canada, the company still face criminal charges filed in its place in 2015 by the royal Canadian mounted police, which could be avoided, if convicted, tenders federal for ten years.
For the moment, the public prosecution Service of Canada refuses to negotiate a repair agreement with the company. These agreements generally provide for the payment of a fine and a series of conditions to be met in exchange for an abandonment of the judicial proceedings.