Vancouver stadium cost overruns hit Canam’s bottom line

Steel fabricator Canam Group Inc. (TSX:CAM) of Boucherville, Quebec has suspended its dividend after reporting a higher second-quarter loss, due in part to lower margins and cost overruns on the replacement of the roof on B.C. Place stadium in Vancouver.

Steel fabricator Canam Group Inc. (TSX:CAM) of Boucherville, Quebec has suspended its dividend after reporting a higher second-quarter loss.

The Montreal-area company reported higher sales, both for the second quarter and the first six months of the year. But president and chief operating officer Marc Dutil said that a higher loss over both periods was a result of reduced margins and cost overruns on the $100-million-plus replacement of the roof on B.C. Place stadium in Vancouver by its business unit Structal-Heavy Construction.

The company said its consolidated sales grew by 21 per cent to $218.5 million for the second quarter, compared with $180 million for the second quarter of 2010. It posted a second-quarter net loss of $5.8 million, compared with $1.7 million for the year-ago period.

For the first six months of 2011, Canam’s net loss was $45.5 million, compared with a net loss of $2.3 million for the year-ago period. Consolidated sales for the first six months grew to $369 million from $281 million.

Dutil said most of Canam’s business units have contributed to the increase in sales, noting sales increases and new business in the joist and steel deck markets, in both Canada and United States.

Canam Group’s backlog of orders as of June 25, stood at $512 million, down slightly from $519 million at the beginning of the quarter.

Canam Group is a leader in the design and fabrication of construction products and solutions and a leading provider of design-build and virtual design and construction services. The company operates more than 25 manufacturing plants and engineering offices in Canada, the United States, Romania, India and China, and has partnerships with companies in Saudi Arabia, the United Arab Emirates and China.

DCN NEWS SERVICES