11/11/2013 - 14:34

Forge extends trading suspension

11/11/2013 - 14:34

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Forge Group says performance issues at two of its power station projects are likely to affect its earnings guidance, with the company extending a voluntary trading suspension as it holds discussions with financiers.

Forge Group managing director David Simpson.

Forge Group says performance issues at two of its power station projects are likely to affect its earnings guidance, with the company extending a voluntary trading suspension as it holds discussions with financiers.

The company had been expected to resume trading this morning after last week entering a trading halt and then a voluntary suspension but told the market today that it needed more time to assess the issues.

"Forge believes that the concerns it has identified are likely to materially affect its earnings guidance and outlook for the financial year ending 30 June 2014," the company said.

"Forge is also currently in discussions with its financiers and advisors in order to determine what actions Forge may take to address the concerns identified."

The company now expects to make an announcement on its earnings guidance and outlook for the 2014 financial year on Wednesday.

Forge told the market upon entering a trading halt that it had identified concerns in relation to potential underperformance at its engineering procurement and construction contracts at Rio Tinto's West Angelas power station project in the Pilbara and the Diamantina power station in Queensland following an internal monthly review.

Both projects were acquired as part of Forge's purchase of CTEC in January last year.

At Forge's annual general meeting last month, 40 per cent of shareholders voted against the company's remuneration report,

The company reported a nearly 30 per cent jump in net profit for the 2013 financial year on the back of a record revenue performance.

Forge shares last traded at $4.18.

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