Damage from a fire at the International Convention Centre site. Photo: RNZ / Cole Eastham-Farrelly
Fletcher Building is putting aside more money for possible losses from the International Convention Centre project in Auckland.
It said its audit and risk committee had reviewed the potential extra costs from the project and accordingly it was adding $105 million to its provisions.
The extra costs were broken down as $50m project cost risk, a $20m reduction in how much it might get from contract works insurance, and $35m on the risk it gets no payments from third party liability (TPL) insurance, although it believed that it could get more than $100m from that source.
"While the company considers it has good grounds to recover these amounts, it has determined that these proceeds from the TPL policy are not yet virtually certain as required by accounting standards to be recognised in its accounts," it said in a note to the stock exchange.
The convention centre contract has been a source of financial pain for Fletcher Building, with cost overruns, design changes, and the 2019 fire causing significant losses.
The company reaffirmed its pre-tax earnings forecast of June of around $800m, before significant items.
Fletcher Building reports its full year result of 16 August.
