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Last Updated: Thursday, 23 February 2006, 06:04 GMT
Losses for Wembley firm hit 106m
Wembley Stadium development
The redevelopment of Wembley is months behind schedule
The firm building the new Wembley Stadium has revealed that its losses on the project totalled 106m ($184m) in the first half of its financial year.

Australian firm Multiplex, which is behind schedule on the giant London project, admitted the losses were "extremely disappointing".

They contributed to an overall loss of 50m for the six months to 31 December.

Earlier this week England's Football Association said Wembley would not be ready for May's FA Cup Final.

The game will instead now be played at Cardiff's Millennium Stadium.

Daily penalties

Multiplex chief executive Andrew Roberts insisted on Thursday morning that the company did not expect any further Wembley losses beyond the 106m.

The outlook for the (construction) division remains strong within both Australia and internationally, following continued success in securing profitable new work
Multiplex

It said the figure - amounting to 120,000 a day since 31 January - included all the penalty payments it is liable to pay for not completing the stadium on time.

The company said factors delaying Wembley's completion included subcontractors' performance, changes in design, relations with trade unions for those working on the site and the weather.

However, Multiplex insists there is no prospect of it going bankrupt and leaving the stadium unfinished. It said it was "disappointed" by the FA's decision to move the final.

Fixed-price contract

"Nothing has changed since the end of January, when we said there was a 70% chance of the stadium being ready for the 2006 FA Cup final," a Multiplex spokesperson said this week.

"We were not able to increase this to 100%, so the FA decided to make alternative arrangements."

Multiplex agreed a fixed-price contract of 445m to build Wembley Stadium - with the project set to cost the FA 757m in total.

Difficulties with the redevelopment of the 90,000-seat stadium prompted the resignation of Multiplex founder and executive chairman John Roberts in May as the group blamed "cost blow-outs" for the spiralling cost of the stadium.

Rising revenues

Despite the 50m first half loss, which compares to a slight 5m profit for the same period 12 months previously, Multiplex said it remained on target to make a full year profit of 50m.

Its group-wide revenues for the first half rose 9.6% to 730m.

Apart from Wembley, Multiplex said its construction division remained strong, with 41 of its other 42 current projects achieving expected margins.

"The outlook for the division remains strong within both Australia and internationally, following continued success in securing profitable new work," it said.

Multiplex's other construction projects include the White City shopping development in west London.




BBC NEWS: VIDEO AND AUDIO
What Multiplex bosses say about the stadium plans




SEE ALSO:
Wembley dropped for FA Cup final
21 Feb 06 |  Football
Multiplex allays bankruptcy fears
21 Feb 06 |  Football
Wembley builder in 2006 warning
19 Dec 05 |  Business
Higher costs hit Wembley builder
18 Aug 05 |  Business


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