German construction group Hochtief revealed it may have to write down the value of its road contracts in Greece due to mass toll dodging.
The news accompanied a warning that Hochtief may post a loss for this year if it fails to sell its airport business on schedule, and a gloomy outlook for 2012.
"The economic crisis in Greece and persistent mass toll dodging led to major shortfalls in income development for the toll road projects Maliakos-Kleidi and Elefsina-Patras-Tsakona," Hochtief said.
It added that the consortium of companies that operate the toll roads are in negotiations with the Greek government to find a long-term solution.
Hochtief stock was down 8 percent, while the German mid-cap index rose 0.23 percent.
The group said it still expects to sell its airports business but the timetable may slip.
"We are still in close negotiations and are confident of being able to seal the transaction in the near future. It is nonetheless possible that this will no longer happen in 2011 as previously announced," Hochtief said.
The company, majority-owned by Spain's ACS, said a delay to the planned sale would lead to a double-digit million euro pretax loss and a net loss of about 100 million euros ($137.3 million) this year.
Analysts were expecting a pretax profit of 362 million euros and net profit at 338 million, according to a Reuters poll.
Hochtief also scrapped its 2012 outlook, which had called for pretax profit of about 1 billion euros and a net profit of 500 million, only saying it now saw pretax profit and net profit coming in significantly above the 2010 level.
Chief Executive Frank Stieler told journalists on a conference call that there was still more than one bidder for the airports business and that there was no indication the sale could fail altogether.
The assets up for sale include Hochtief's stakes in airports in Athens, Budapest, the German cities of Duesseldorf and Hamburg, as well as Sydney and Tirana.
Sources have told Reuters that HNA Group, the parent of China's Hainan Airlines and France's Vinci are contenders for the unit, each with offers of almost 1.5 billion euros.
Third-quarter pretax profit more than doubled to 333 million euros but fell short of the 340 million euro average analyst estimate in a Reuters poll as a number of major contracts in Europe were delayed.
Hochtief's Australian unit Leighton Holdings, bruised by heavy losses on its two biggest projects, last week stuck to its outlook but promised to be more selective in taking on new projects and keep a closer eye on potential risks.
Hochtief's parent company ACS and German rival Bilfinger Berger are due to report quarterly results later on Monday.
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