March 5, 2010 / 3:35 PM / in 8 years

UPDATE 2-SNC Lavalin profit climbs, raises dividend

* EPS C$0.65 vs C$0.49 in year-before quarter

* Revenue 18.5 pct lower at C$1.58 bln

* Backlog of work C$10.8 bln

* Says 2010 net income will match or better 2009

* Stock ends 4.4 pct higher at C$52.18 (Adds comments from analyst, management, closing stock prices)

OTTAWA, March 5 (Reuters) - SNC Lavalin Group Inc (SNC.TO), Canada’s biggest engineering and construction company, posted a big jump in quarterly profit on Friday as it completed more high-margin work, and its shares rose.

Citing its hefty C$10.8 billion ($10.4 billion) backlog and positive outlook, the company also raised its quarterly cash dividend by 13 percent to 17 Canadian cents a share.

“With a strong revenue backlog and diverse prospects in Canada and outside Canada, we expect our 2010 net income to be as high or higher than 2009,” said Chief Executive Pierre Duhaime.

The Montreal-based company said it was being “a bit prudent” and was not yet ready to repeat its 2008 forecast for profit growth of 7 percent to 12 percent.

Profit grew 15 percent in 2208 to C$359.4 million.

SNC said the economy was on the path to recovery, with the worst behind it, and that it expects higher activity in 2009 and fewer project delays than 2008.

It also said it remains interested in acquisitions and is “working on many of them”, but is cautious because prices are still too high.

For the quarter ended Dec. 31 net profit rose to C$98.7 million, or 65 Canadian cents a share, from C$75 million, or 49 Canadian cents a share, in the year-earlier quarter.

Revenue fell to C$1.58 billion from C$1.94 billion.

On average, analysts had expected earnings of 54 Canadian cents a share and revenue of C$1.7 billion, according to Thomson Reuters I/B/E/S.

“SNC Lavalin’s performance this year has been nothing short of remarkable as it proved once again that the company’s diversification across geographies, contract types and development cycles can withstand the stress test of plunging commodity prices and difficult credit conditions,” said Genuity Capital analyst Maxim Sytchev.

Shares of SNC rose C$2.20 to end at C$52.35 on the Toronto Stock Exchange on Friday. ($1=$1.03 Canadian) (Reporting by Susan Taylor; editing by Peter Galloway)

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