UPDATE 1-Sweden's Skanska says LatAm charges to weigh on second quarter

Thu Jul 10, 2014 3:27am EDT

Related Topics

* Skanska to take 500 mln SEK charge in LatAm

* Appoints new head of Latin American business

* Says expects Q2 op profit of 920 mln crowns

* Shares fall 2.6 pct (Adds detail, shares)

STOCKHOLM, July 10 (Reuters) - Sweden-based construction company Skanska said on Thursday it would significantly scale down its loss-making Latin American operations after taking a charge of 500 million Swedish crowns ($73.6 million) in the second quarter.

The Latin American business, which Skanska has restructured to cut costs amid flagging demand from the mining sector, accounted for roughly 7 percent of its revenue last year and made losses in 2013 and 2012.

The company also said it had appointed a new head of its Latin American operations - Johan Henriksson, currently chief financial executive at construction unit Skanska USA Civil.

Skanska said group operating profit was expected at 920 million crowns in the second quarter, with 620 million coming from its construction business.

Of the 500 million crowns charge, 380 million was related to writedowns in two power plant projects in Brazil and one petrochemical plant project in Argentina, and 120 million was restructuring costs.

Skanska shares fell 2.6 percent to 146.90 crowns at 0717 GMT, while the broader Stockholm share index was down 0.3 percent. ($1 = 6.7883 Swedish Crowns) (Editing by David Holmes)

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