Hochtief still expects to reach its full-year targets after its Australian unit Leighton cut its outlook for 2009, the German construction company said on Tuesday.
Good results at other business divisions would offset write-downs at Leighton, helping Hochtief reach its targets of sales and net profit above the year-earlier level, the company said in a statement.
Top Australian engineering contractor Leighton earlier cut its fiscal 2009 outlook due to write-downs on investments and said it would hold its interim and full-year dividends at the same level as last year.
Shares in Leighton fell as much as 10.6% following the profit warning, and Hochtief's shares were indicated to open 3.1% lower.
Hochtief's Chief Executive Herbert Luetkestratkoetter told Reuters he did not see any need for further write-downs at Leighton, and said it was still valid that shareholders would receive an appropriate share of Hochtief's profit.
He had told the Financial Times in an interview published on Monday that Hochtief had seen very few orders cancelled amid the global economic crisis as it benefited from government-sponsored infrastructure investments in emerging markets.
In Australia, the company also benefits from government infrastructure projects.
But many of the projects there are listed on the stock market to attract the interest of infrastructure funds, pension funds and private investors. Recent share price drops “no longer reflect the infrastructure projects' real worth,” Hochtief said on Tuesday.
Leighton's operating business was still in a very good condition, the company said. (Reuters)