Transfield Services full year guidance update

Transfield Services has revised its full year guidance for FY12. The Company now expects full year reported NPAT to be $105 million pre‐amortisation.

This new guidance figure allows for:

  • $9 million of extreme weather impact since guidance was updated on 22 February
  • $16 million of provisions for a legacy construction contract

Rain and associated access delays in January and February were budgeted for across Easternwell and the rest of the Transfield Services Australian business. But the cyclone in Western Australia, as well as unusual extreme weather in South Australia and Queensland in late February and early March were not budgeted for.

The construction contract in the Company’s New Zealand business has a clear line of sight to completion in July 2012, and is currently 85 per cent complete. Variations and other entitlements are being pursued with the client. Once resolved, this will conclude the review and remediation of legacy contracts.

Transfield Services continues to grow its order book, now standing at $11 billion. In addition, the Company has in excess of $650 million of preferred work expected to be converted to confirmed contracts in coming weeks, and $2.7 billion in potential contract extensions.

The Company also advised that its pre‐emptive right has been triggered, entitling it to acquire Flint Energy Services’ shares in the FTS Joint Venture in Canada. Transfield Services is valuing the shares in FTS owned by Flint and is currently proceeding in accordance with the pre‐emptive process in the shareholders’ agreement, as well as considering all other options.

The Company’s on market buy‐back of shares remains in place, and will recommence following this update.

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Transfield Services employs over 19,000 people across 18 industries and 10 countries. We are a global provider of operations, maintenance and construction services to the Resources, Energy, Industrial, Infrastructure, Property and Defence sectors.
We deliver asset management services across all phases of the asset lifecycle, from concept and creation, to services that sustain, optimise and enhance our Client’s assets. With diverse global experience and expertise, we share our knowledge and challenge thinking to develop and implement innovative solutions that deliver real value for our Clients. Our unique approach enables us to deliver continuous improvements in asset performance and sustain long term relationships with our Clients and partners.