Shares in Amec have lost ground after the British project manager and contractor warned investors that first-half trading at its struggling construction arm in the UK had been weaker than expected.
Amec, which is exiting most of its construction activities in the UK and United States as part of a three-way break-up of the group, also confirmed a string of forthcoming exceptional charges.
These include a total of £65 million of legal and other costs associated with the withdrawal from construction and a £20 million provision to settle protacted legal disputes.
Despite weak first-half trading, Amec kept to its forecasts for profits before these exceptionals occur.
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But the shares slipped on what investors interpreted as a grim trading update. By mid-morning they had lost 11.25p - or 3.26 per cent - to 334.25p.
The stock market values Amec at more than £1.15 billion. For full details on th shares click here
Amec, whose chief executive is Sir Peter Mason, said it would be booking a gain of about £295 million after tax on the sale of Spie, its France-based technical services division. Amec had wanted to complete the sale before pressing ahead with the next stage of its break-up.
Spie was sold last month to PAI Partners for £707 million, much more than analysts had been predicting. Amec received more than 40 expressions of interest in Spie.
Sir Peter said: “We are delighted with the result of the sale of Amec Spie ... After the charges being announced today, the sale and the aggregate exceptional gain of £230 million after tax in 2006 gives Amec flexibility for future investment while also allowing consideration of a return of capital to shareholders.
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“We believe that the charges we are taking allow us to draw a line under previously announced business closures.”
Outside the UK, Amec said it was performing well in North America and better in Iraq than expected.