黑洞社区

Consultant Sweett Group has issued a profit warning due to 鈥渃hallenges in certain overseas operations鈥�.

In a statement to the City last night the firm said its results for the year to 31 March 2015 would be 鈥渕aterially below market expectations鈥�.

Although it did not specifically identify what overseas operations were experiencing challenges it did say that it may have to write down some of the 拢3m value of goodwill in its Australian business unless trading improves.

It said: 鈥淭he board continues to monitor closely our Australia business where, without a significant improvement in trading over the second half of the year, it is likely that an impairment will have to be made in the group鈥檚 results.鈥�

It also said that the Middle East market 鈥渞emained challenging for the group鈥�.

It said that in the Middle East it was 鈥渃ommitted鈥� to its strategy of 鈥渞educing and restricting鈥� the firm鈥檚 exposure in the region.

It also said that its Asia Pacific region had had a 鈥渕ixed performance鈥� so far this financial year. It said there had been continued growth in the business in China but that the Hong Kong market had been 鈥渄isappointing鈥�.

However, it said the UK market had 鈥渞ecovered鈥� and experienced 鈥渟trong growth鈥�.

Sweett also warned that it would be making an exceptional charge in its results for the cost of its investigation into allegations of bribery in the Wall Street Journal last year.

Last June the Wall Street Journal reported that in 2010 a Sweett executive told an architect at US-based practice HLW hoping to work on a hospital project in Morocco that his company would have to pay 3.5% of the value of the contract to an official at the client to win it.

In April Sweet hired lawyer Mayer Brown to undertake a second investigation into the allegations, after an earlier investigation by Pinsent Mason found the allegations were 鈥渘ot proven鈥�. Later that months it said it had found 鈥渕aterial instances of deception鈥� that may have been perpetrated by employees or former employees of the group.

Sweett has now said the investigation was 鈥渘earing completion鈥� and that it was continuing to cooperate with the Serious Fraud Office.

John Dodds, chair of Sweett Group, said: 鈥淪ince becoming Chairman in August, I have conducted a thorough review of the group鈥檚 business, the outcome of which is set out in today鈥檚 announcement.

鈥淚 am looking forward to taking the business forward with a greater focus on profitability and cashflow.鈥�