March 6, 2009 / 1:51 PM / 9 years ago

UPDATE 2-SNC Lavalin builds on earnings, raises dividend

* Q4 EPS C$0.49 vs C$0.45 a year ago

* Company raises dividend by 25 percent

* CEO steps down, Pierre Duhaime named as successor

* Shares up about 3.5 percent (Adds CEO’s retirement, quote, details, share price)

TORONTO, March 6 (Reuters) - SNC-Lavalin Group Inc (SNC.TO), a leading Canadian engineering and construction company, reported a 9 percent increase in quarterly profit on Friday, mainly due to higher income from its investment in an Ontario toll highway.

The company said it will raise its quarterly dividend by 25 percent to 15 Canadian cents per share, and its share price rose about 3.5 percent after the news.

Fourth-quarter net income rose to C$75 million ($58.6 million), or 49 Canadian cents a share, from C$68.7 million, or 45 Canadian cents, in the same period a year before.

Montreal-based SNC credited the bulk of the increase to higher income from a toll highway near Toronto that it partly owns.

Excluding the infrastructure concession investments segment, which includes the toll highway revenue, net income slipped 1.9 percentr. The company said that was due to a loss by its chemicals and petroleum segment, and a lower contribution from it operations and maintenance segment.

But the contribution from its mining segment rose and the loss by its power segment narrowed.

All told, revenue dipped to C$1.94 billion from C$1.99 billion in the year-before quarter.

The company said it was eyeing net income growth of 7 to 12 percent in 2009. In 2008, net income more than doubled but after stripping discontinued operations, net income would have been up 49 percent.

“Our capacity to operate in different categories of activity and industry sectors and the fact that we have permanent offices in over 35 countries gives us the basis to achieve our expected net income growth,” Jacques Lamarre, SNC’s president and chief executive, said in a statement.

“However, we remain cautious given the uncertainties regarding the global economic situation.”

Separately, SNC said Lamarre was set to retire after a 42-year career with the company. He will be replaced by Pierre Duhaime on May 7.

The company ended December with a backlog of orders worth C$9.6 billion, compared with C$10.6 billion at the end of quarter in the prior year.

SNC had C$988.2 million in cash and cash equivalents as of Dec. 31.

Shares of SNC were up 3.5 percent at C$29.65 in morning trade on the Toronto Stock Exchange. ($1=$1.28 Canadian) (Reporting by John McCrank; Editing by Frank McGurty)

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