SNC-Lavalin cuts 2016 adj profit forecast for core business

Thu Sep 29, 2016 8:23am EDT
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Sept 29 (Reuters) - Canada's SNC-Lavalin Group Inc cut its full-year adjusted profit forecast for its engineering and construction business due to commercial issues in two oil & gas projects in the Middle East.

The company said it expected full-year adjusted profit for its core business to be C$1.30 to C$1.60 per share, lower than its previous forecast of C$1.50 to C$1.70.

The engineering and construction business contributed about 67 percent of the company's adjusted profit in the second quarter ended June 30.

SNC-Lavalin said it expected to revise cost and revenue forecasts in the Middle East contracts for the third quarter but discussions were on to resolve the issues.

The fourth quarter is expected to return to a more normal run rate, the company added.

SNC-Lavlin also said the outlook for its other businesses remains "largely unchanged" with the infrastructure unit trending to be slightly better than expected. (Reporting by Arathy S Nair in Bengaluru; Editing by Don Sebastian)