19/02/2009 - 13:16

Paladio may take $4m hit from Windimurra

19/02/2009 - 13:16

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Engineering and construction company Paladio Group says it is well placed to deliver a profit for fiscal 2009 despite a possible $4 million hit from the suspension of works at the Windimurra Vanadium project.

Paladio may take $4m hit from Windimurra

Engineering and construction company Paladio Group says it is well placed to deliver a profit for fiscal 2009 despite a possible $4 million hit from the suspension of works at the Windimurra Vanadium project.

The Belmont-based company said it has not received full payment owing for work completed at the project and that the board had made a decision to make a provision of $4 million in the second half of this year.

Yesterday, administrators and receivers were appointed to cash-strapped project owner, Windimurra Vanadium.

The collapse of Windimurra has prompted a suspension of development works for the nearly completed Mid West mine, with 200 contractors expected to be redeployed and the jobs of 50 employees in doubt.

Paladio managing director Victor Kruss said despite this event, and despite incurring substantially all the costs associated with the project, the company remained cash flow positive for the first half of fiscal 2009.

The company's remaining contracts are with major blue chip customers including Woodside Petroleum and BHP Billiton.

"Paladio remains confident it is well placed to deliver a profit for the full year despite this setback on Windimurra," the company said.

Shares in Paladio were down 2.5 cents to 12c at 15:22 AEDT.

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