SNC-LAVALIN ANNOUNCES ITS FIRST QUARTER RESULTS FOR 2012
N.B.: All amounts indicated are in Canadian dollars.
SNC-Lavalin Group Inc. (TSX: SNC) announced its results today for its first quarter ended March 31, 2012.
For the first quarter of 2012, net income attributable to SNC-Lavalin shareholders was $67.1 million ($0.44 per share on a diluted basis), compared to $76.1 million ($0.50 per share on a diluted basis) for the comparable quarter in 2011. This variance reflects a lower net income excluding Infrastructure Concession Investments, partially offset by a slightly higher net income from Infrastructure Concession Investments. The net income excluding Infrastructure Concession Investments was $42.0 million, compared to $51.7 million for the first quarter of 2011, reflecting lower contributions from Operations & Maintenance, Hydrocarbons & Chemicals, Other Industries and Infrastructure & Environment, partially offset by better contributions from the Mining & Metallurgy and Power segments.
Revenues for the first quarter of 2012 increased by 8.8% to $1.8 billion compared to $1.6 billion in the first quarter of 2011, mainly due to a 39.3% increase in the Services category.
“We are encouraged by the level of customer and partner support, as well as the dedication and determination of our 28,000 employees over the last couple of months,” said Ian Bourne, Vice-Chairman and Interim Chief Executive Officer, SNC-Lavalin Group Inc. “We are maintaining our 2012 outlook that net income will be in line with the full year 2011 net income, targeting an improvement over last year.”
Revenue backlog remained strong at $10.5 billion at the end of March 2012, compared to $10.1 billion at the end of December 2011, with increases in all the Company’s categories of activity.
The Company’s financial position remained strong with cash and cash equivalents totalling $1.1 billion as at March 31, 2012.
The Company’s return on average shareholders’ equity was 18.5% for the 12-month period ended March 31, 2012.
The Board of Directors today declared a cash dividend of $0.22 per share, payable on May 31, 2012 to shareholders of record on May 17, 2012. This dividend is an “eligible dividend” for income tax purposes.
Mr. Bourne also stated, “We are committed to getting to the bottom of any violations of law, including any fraud that may have been committed against the Company. SNC-Lavalin is providing information to investigative authorities and is fully cooperating with them. We are encouraging our employees to come forward with any relevant information they may have using any of the channels available to them. We are hopeful that through our cooperation, we can help bring anyone responsible for illegal acts to justice.”
SNC-Lavalin (TSX: SNC) is one of the leading engineering and construction groups in the world and a major player in the ownership of infrastructure, and in the provision of operations and maintenance services. SNC-Lavalin has offices across Canada and in over 40 other countries around the world, and is currently working in some 100 countries. www.snclavalin.com
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Reference in this press release, and hereafter, to the “Company” or to “SNC-Lavalin” means, as the context may require, SNC-Lavalin Group Inc. and all or some of its subsidiaries or joint ventures, or SNC-Lavalin Group Inc. or one or more of its subsidiaries or joint ventures. Statements made in this press release that describe the Company’s or management’s budgets, estimates, expectations, forecasts, objectives, predictions or projections of the future may be “forward-looking statements”, which can be identified by the use of the conditional or forward-looking terminology such as “anticipates”, “believes”, “estimates”, “expects”, “may”, “plans”, “projects”, “should”, “will”, or the negative thereof or other variations thereon.
This 2012 outlook referred to in this press release is based on the methodology described in the Company’s annual Management’s Discussion and Analysis under the heading “How We Budget and Forecast Our Results” and is subject to the risks and uncertainties described in the Company’s public disclosure documents, including risks resulting from the Independent Review.
The Company cautions that its actual actions and/or results could differ materially from those expressed or implied in forward-looking statements, or could affect the extent to which a particular projection materializes, as a result of risks and uncertainties relating to: (a) cost overruns from fixed-price contracts; (b) failure to meet scheduled dates or performance standards on a particular project; (c) attracting and retaining qualified personnel and any strike, partial work stoppage or other labour actions by the Company’s or its subcontractors’ unionized employees; (d) failure of the Company’s joint venture partners to perform their obligations; (e) failure by the Company’s subcontractors to deliver their portion of a particular project according to contractual terms; (f) the financial performance of the Company’s infrastructure concession investments during a particular concession period; (g) the Company obtaining new contract awards; (h) revenue backlog and whether such revenue backlog will ultimately result in earnings and when revenues and earnings from such backlog will be recognized; (i) foreign currency exchange and interest rates; (j) credit risk and the delay in collection from the Company’s clients; (k) information management including its integrity, reliability and security; (l) the inherent limitations of the Company’s control framework and the effectiveness of the measures implemented by the Company to strengthen its internal controls over financial reporting following the identification by the Company of material weaknesses relating to the design and operational effectiveness of its internal controls over financial reporting as of December 31, 2011 and March 31, 2012 respectively; (m) uncertain economic and political conditions in the countries in which the Company does business; (n) any lack of strong safety practices by the Company or its subcontractors exposing the Company to lost time on projects, penalties, lawsuits and impact on future contract awards; (o) the Company’s inability to comply with environmental laws and regulations; (p) the Company’s reputation as a result of, among others, any quality or performance issues on its projects, a poor health and safety record, non-compliance with laws or regulations by the Company’s employees, agents, subcontractors, suppliers and/or partners, or creation of pollution and contamination; (q) the inability to adequately integrate an acquired business in a timely manner; (r) non-compliance with laws and regulations by an employee, agent, supplier, subcontractor and/or partner of the Company or any further regulatory developments; (s) failure by the Company’s employees, agents, suppliers, subcontractors and/or partners to comply with anti-bribery laws; (t) any litigation and/or legal matters to which the Company is a party; (u) any negative publicity associated with the Independent Review led by the Company’s Audit Committee of the facts and circumstances surrounding certain payments that were documented to construction projects to which they did not relate, and certain other contracts, as well as any sanctions that could be brought against the Company in connection with possible violations of law or contracts should additional facts adverse to the Company become known in connection with such Independent Review including as to matters beyond its scope; (v) the proposed class action lawsuit filed on March 1, 2012 against the Company with the Quebec Superior Court; and (w) the investigations of the Royal Canadian Mounted Police and the World Bank relating to the Company’s involvement in a past submission as the Owner’s Engineer for the Bangladesh government.
For more information on risks and uncertainties, and assumptions that would cause the Company’s actual results to differ from current expectations, please refer to the section “Risks and Uncertainties” and the section “How We Analyze and Report our Results”, respectively, in the Company’s 2011 Financial Report under “Management’s Discussion and Analysis” and the section “Risks and Uncertainties” in the Company’s first quarter 2012 Management’s Discussion and Analysis. The forward-looking statements herein reflect the Company’s expectations as at the date of this press release and are subject to change after this date. The Company does not undertake any obligation to update publicly or to revise any such forward-looking statements, unless required by applicable legislation or regulation.
Media ContactLeslie Quinton
Senior Vice-President, Global Corporate Communications
SNC-Lavalin Group Inc.
Vice-President, Investor Relations
SNC-Lavalin Group Inc.