Transfield To Sell USM For US$255 Million To Emcor; Reiterates Guidance

Transfield Services Ltd. (TSE.AU) said Thursday it has agreed to sell its North American facilities maintenance business USM to Emcor Group Inc. (EME) for US$255 million.

The company also reiterated a target of mid-single-digit percentage growth for fiscal 2011 net profit before items. The expected contribution to earnings before interest, taxes, depreciation and amortization from the USM sale is about A$24 million.

Transfield said in a statement the expected impact of the sale in the year to June 30 will include a non-cash underlying net loss on the sale of discontinued operations of A$16 million, including transaction costs.

"Further to this, Australian Accounting Standards require accumulated currency translation losses of A$45 million to A$50 million relating to USM to be reclassified to retained earnings," Transfield said. The accounting losses will be included in fiscal 2011 net profit but won't affect underlying earnings, it said.

Transfield expects to continue to pay dividends within the previously disclosed target range of 50%-70% of operational net profit.

 
   -By Sydney bureau; 61-2-8272-4680; [e-mail]