25/02/2009 - 13:02

Nomad lowers FY forecast as profit falls

25/02/2009 - 13:02

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Nomad Building Solutions has revised down its full year net profit forecast for the third time after reporting a 62 per cent slump in its interim earnings.

Nomad Building Solutions has revised down its full year net profit forecast for the third time after reporting a 62 per cent slump in its interim earnings.

In its half year report released today, the company said it now expects a full year net profit after tax of $21 million, excluding the $6.9 million goodwill impairment charge arising from the acquisition of the Rapley Wilkinson business.

Previously the company had provided a guidance of around $26 million which had been revised down from an earlier forecast of $33 million.

For the six months to the end of December, the company reported a net profit after tax of $8.2 million, down from the prior corresponding period's $10.4 million.

After including the impairment charge, the company's net profit slumped 87.2 per cent to $1.3 million.

Revenue for the period jumped 61.8 per cent from $145.5 million to $234.5 million.

Nomad said its transportable housing operations, McGrath Homes and Halley Homes, have continued to perform well in both WA and Queensland, but the Rapley Wilkinson construction business had performed at a satisfactory level.

"[Rapley] has been impacted by the deferral of a number of projects that were expected to commence late in 2008," Nomad said.

"However, since the new year the business has seen an increase in tendering activity.

"Problems in the Nomad Modular Building division in WA, specifically relating to installation works, have significantly affected the Group's result.

"These problems have been experienced across a number of contracts including a significant loss on one turnkey project nearing completion."

Nomad is currently restructuring the division to ensure the first half problems are not repeated.

The directors have declared a fully franked interim dividend of two cents per share.

Shares in the company were up 5.5c or 31 per cent to 23.5c at 15:09 AEDT.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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