ANGLO-Norwegian shipping and construction giant Kvaerner said yesterday that unchanged first-quarter results for 1998 were unsatisfactory.
The company, which owns the Govan shipbuilding yard, reported pre-tax profits of 224 million crowns (#18.4m) whereas analysts had expected higher earnings, of around 300 million crowns or nearly #25m.
However, president and chief executive Erik Tonseth forecast the full-year figures, excluding asset sales such as the #300m disposal of the Cunard liner fleet to Carnival, would exceed 1997's 1510 million crowns.
The major problem areas were in shipbuilding where under-estimation of costs on contracts at its Masa-Yards Finnish division hit hard, while the oil and gas division was adversely affected by low margins on large field contracts in both Norwegian and British waters. The Govan yard made a small operating profit compared with a loss a year earlier.
However, there was better news from construction where there was a swing round into profits at the former Trafalgar House activities and in process despite problems in South-east Asia.
Predictably the metals activities were hit by the strength of sterling but the underlying performance was reassuring. Pulp and paper was also hit by the Asian problems.
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