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Multiplex losses spiral further on Wembley

Wembley stadium contractor Multiplex warned today that it faced a further increase in losses on the project.
While Multiplex said it still targeted the completion of the project in time for the FA Cup Final in May, the loss position was likely to be 'substantially adverse' from previous indications.

Shares in the Australian-based company fell sharply as it warned that Wembley and factors related to other areas of business were likely to knock around £70 million from 2006 profits. Last month the group had predicted a full-year earnings figure in the region of £90 million.

Multiplex has been dogged by problems on the Wembley project, which has incurred litigation and higher costs after a change of steel contractor.

The impact of the fixed-price contract was shown in August as its construction division revealed full-year losses of £26.1 million, compared with profits of £30.8 million in 2004.

The company said today that its exact position on the project was still subject to 'considerable variability' because of the final outcome of steel costs and negotiations in relation to numerous sub-contractor claims.

It stressed that its forecast on group profits was 'preliminary and subject to material change' .

However, it added: 'Multiplex continues to target completion of the Wembley stadium to enable the 2006 FA Cup Final to be played, with progressive handover of parts of the stadium expected to commence from January 31, 2006.'

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