Leighton Holdings has issued its second profit loss warning in six months as the company struggles to stem the losses incurred from its troubled Victorian desalination plant and Brisbane airport tunnel.

 

The company announced it expects the desalination plant to cost a further $106 million, while the airport tunnel link is expected to cost a further $148 million.

 

Leighton Holdings’ Chief Executive Officer, Mr Hamish Tyrwhitt, said that he was deeply disappointed with the results which represent a significant deterioration in performance since the December 2011 Quarterly Reviews. 

 

“Following the December 2011 Quarterly Reviews, we believed that the operational performances at both the Airport Link and Victorian Desalination Project had stabilised and that good progress was being made on both projects.

 

“However, circumstances on each project have conspired to bring about the results today which are very frustrating. Wet weather in Brisbane, productivity below expectations at both sites combined with the complexity of the commissioning of the integrated systems at APL have see unanticipated increase in forecast costs and denied us the level of performance that we were expecting or needed on those projects,” said Mr Tyrwhitt.

 

The disappointing results are expected to slash between $100 and $150 million of profits, resulting In a slide to a net profit after tax of around $400 to 450 million.