A massive cost increase on an ethylene plant in Asia pushed Shaw Group to a loss of $67.8 million, or 86 cents per share, during the third quarter of its fiscal year, the Baton Rouge company reported Tuesday.
The engineering and construction company earned $49.1 million, or 57 cents per share, a year earlier.
Shaw’s stock closed Tuesday at $32.31 cents, up 71 cents per share.
The company reported its earnings after the markets closed Tuesday. In the first 120 minutes of after-hours trading, Shaw’s stock had fallen to $28.31 per share, a drop of $4.05, or 12.5 percent.
Shaw will hold a conference call with stock analysts and investors Wednesday morning. Analysts surveyed by Thomson Reuters had estimated Shaw’s third-quarter earnings at 68 cents per share.
Shaw said its results were “impacted negatively” by a pre-tax cost of $112.8 million, or $68.9 million after taxes, from “subcontractor execution issues” on the Energy and Chemicals segment project. Shaw did not name the project in its earnings announcement.
The company also took a pre-tax hit of $48.1 million, or $29.4 million after taxes, on loans made to Nuclear Innovation North America’s South Texas project. The partnership between NRG Energy and Toshiba Corp. planned to build two new nuclear reactors at a plant about 90 miles southwest of Houston.
Construction work at the plant was stopped in the wake of the earthquake- and tsunami-related nuclear disaster in Japan.
Shaw said it is trying to recover some of that money from partially manufactured equipment and other assets related to the project, but the amount of the recovery remains uncertain at this time.
“This was an extremely challenging and disappointing quarter for Shaw,” Chairman, President and Chief Executive Officer J.M. Bernhard Jr. said in a news release.
Bernhard said Shaw took the full loss on the Nuclear Innovation project because it’s difficult to determine the value of the assets in which Shaw and other creditors hold an interest.
Although the Nuclear Innovation and the Energy and Chemicals division projects hurt Shaw’s results, Bernhard said he was encouraged that most of its segments continued their strong performance.
Revenue for the quarter dipped to $1.49 billion from $1.79 billion last year. Analysts surveyed by Thomson Reuters expected revenues of $1.69 billion for the quarter.
Shaw’s third quarter ended May 31. The results did not include its Westinghouse segment, which is affected by currency exchange rates.
Shaw also announced it expected to earn 60 cents per share for the fourth quarter of the fiscal year and per-share earnings of $2.20 to $2.50 during the 2012 fiscal year, excluding the Westinghouse segment.
Shaw’s earlier estimate of fiscal 2011 forecast earnings of $1.70 per share to $1.80 per share. Stock analysts surveyed by Thomson Reuters expect earnings of $1.80 per share.