Transfield Services Ltd. (TSE), an Australian engineering company, fell the most in 18 months in Sydney trading after cutting its full-year profit forecast by as much as 37 percent because of weak demand.
Transfield slumped as much as 15 percent and was headed for the biggest decline since August 2011. Shares of the Sydney- based company fell 5.7 percent to A$1.825 at 1:37 p.m. The benchmark S&P/ASX 200 index slipped 0.7 percent.
The company posted a record half-year loss today and said falling earnings at the Easternwell mineral exploration business and the Timec oil-refinery unit would lead to profit excluding one-time items of between A$85 million ($87 million) and A$90 million in the 12 months ending June. That’s less than its Aug. 29 forecast of A$125 million to A$135 million, and the A$107 million average of 14 analyst estimates compiled by Bloomberg.
“We expect investors to remain concerned about the future earnings ability, and therefore continued carrying value, of Easternwell,” Anthony Passe-de Silva, an analyst with JPMorgan Chase & Co. in Sydney, wrote in a note Feb. 19. A recovery is “unlikely to come through in the near term” at Easternwell, as mineral companies scale back spending plans, he wrote.
The net loss in the six months ended Dec. 30 totaled A$247 million, driven by A$275 million in impairments to Easternwell and Timec, the company said.
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