(Reuters) – British engineering contractor Keller Group Plc warned on Monday its annual operating profit would come in slightly below the bottom-end of market expectations, hit by financial reporting fraud in its Australia-based unit Austral.
Analysts, on average, expect full-year operating profit in the range of 109 million pounds to 114 million pounds ($138.36 million), according to a company-provided consensus.
Shares in the mid-cap company were down nearly 5%, as of 0819 GMT.
Keller said the fraud is linked with an overstatement of the unit’s performance from 2019 onwards, estimating the impact of the fraud to be 6 million pounds in the first half of 2022 and 8 million-10 million pounds in the prior years.
An internal investigation is in progress and two individuals were immediately dismissed after an internal review, the company said, adding that it was looking to appoint an external adviser to launch an independent investigation.
“We have responded swiftly and decisively to a serious issue within one of our business units and a full investigation is underway,” Chief Executive Officer Michael Speakman said.
The Austral business contributes about 3% to the group’s revenue. The company has retained its forecast for 2023.
($1 = 0.8239 pounds)
(Reporting by Anchal Rana in Bengaluru; Editing by Saumyadeb Chakrabarty and Sherry Jacob-Phillips)
