Consolidated Infrastructure share price loses another 37% on more bad earnings news
The decline in profit is going to be worse than the 55% drop flagged last week, as the risks facing its power subsidiary are bigger than it previously assumed
Consolidated Infrastructure Group’s share price crashed 37% to R5 on Tuesday, after it said its expected earnings decline would be worse than its earlier forecast of 55%.Tuesday’s crash followed a 21% drop on November 9, when the engineering group issued a trading statement saying it expected to report before November 30 that its basic and headline earnings per share for the year to end-August would decline by as much as 55%.Consolidated Infrastructure Group said in Tuesday’s statement that at a board meeting on Monday to approve the results, directors decided that risks related to three large, multiyear engineering contracts on which power projects subsidiary Conco was working, were not being accounted for fully."Whilst these contracts remain profitable, the margins previously recognised may result in adjustments to the results in the current reporting period," the updated trading statement said.Some of Conco’s projects had become more expensive due to adjustments to the original s...
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