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UPDATE 2-Bilfinger power unit triggers fourth profit warning

* Other impairments and expenses cost net 88 mln in 9 months

* Other impairments and expenses cost net 88 mln in 9 months

* Cites much worse demand in Germany and other European countries


* 9mo net loss 125 million euros, orders down 9 percent to 5 bln

* Shares down 9 percent (Adds details on guidance, background, updates shares)

By Georgina Prodhan

FRANKFURT, Nov 5 (Reuters) - German industrial services and building group Bilfinger SE has issued its fourth profit warning since the end of June, sending its shares tumbling almost 10 percent.

Bilfinger said on Wednesday a 148 million euro ($185 million) writedown on its energy business, on which it had bet heavily before the industry entered a steep downturn in Europe, would lead to a 2014 net loss, made worse by other impairments and expenses.

"Significantly worsened demand - particularly in Germany and other European countries - has led not only to reduced earnings expectations for 2014 but also to a significant adjustment to earnings forecasts for the years to follow," it said.

Top Bilfinger clients including German utilities E.ON and RWE, previously sources of high-margin services revenue, have been hit hard by Germany's switch to renewable energy and other cheap alternative power sources.

But Bilfinger's interim chief executive had said last month he was "reasonably sure" the company could meet its forecasts after the third warning.

Shares in Bilfinger were down 9 percent to 46.44 euros by 1058 GMT, off a low of 46.05 euros and underperforming a 1.5 percent-stronger European construction sector.

The stock had already lost 39 percent of its value since the company's first warning in June and last month slumped to its lowest since late 2010.

Sweden-based activist investor Cevian has built up a 26 percent stake in the company in recent months and plans to put two of its people on the supervisory board.

Cevian had no immediate comment on Bilfinger's profit warning. It has said in the past it has no problem with Bilfinger's general strategy but wants to improve its execution.

Bilfinger is still looking for a new CEO since Roland Koch, an ex-politician, quit after the second warning in August. The interim CEO, finance chief and chairman all plan to step down.

The company wrote down its power unit by 148 million euros while other impairments and expenses cost it a net total of 88 million euros in the first nine months of the year.

Bilfinger said it had made a net loss of 125 million euros in the first nine months of the year, while orders fell 9 percent to 5.12 billion euros.

It said it expected similar output volume this year to the 7.7 billion euros it achieved in 2013 and confirmed it expected adjusted earnings before interest, tax and amortisation from continuing operations of at least 270 million.

($1 = 0.8013 euro) (Editing by Maria Sheahan and David Holmes)

Published on:
November 6, 2014
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