Fletcher Building has announced that it will make an additional provision of $165 million for the New Zealand International Convention Centre and Hobson Street Hotel project (NZICC).
The increased costs are primarily due to higher levels of subcontractor resource required for the final stage of the project, and there is a possibility that a portion of the company's claims against the project's contract works insurance may not be recoverable.
However, the NZICC project remains on track for completion in late 2024.
Fletcher Building is also working on a remediation solution and claims settlement for the Wellington International Airport Carpark project, for which it will make a provision of $15m.
The company's half-year 2024 financial statements will classify these provisions as significant items.
Fletcher Building's chief executive, Ross Taylor, acknowledged the need for further provisions and said they would vigorously pursue claims for recoveries, which are expected to take until the 2025-2026 financial year to settle.
The company's half-year results and financial statements will be released on Feb 14 2024.
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