Engineering and construction company Civmec has blamed project cost overruns for a 52 per cent drop in profit over nine months.

Civmec has reported US$4.7 ($6.9) million net profit for three quarters ended March 31, compared with US$9.7 ($14) million a year earlier. Revenue fell 15 per cent to US$287 ($415) million.

The Henderson-based company said that in the March quarter it had accounted for existing and forecast cost overruns on some construction projects that were nearing completion. 

Net profit for the quarter slumped 98 per cent to US$97,716 ($141,000) and revenue for the quarter fell 41 per cent US$55 ($80) million.

“We are working with our clients to close out projects which are currently reaching completion and look forward to continued engagement with our blue-chip clients, particularly in the iron ore sector,” Chief Executive Pat Tallon said.

Civmec said it expected to be profitable for the full financial year.

New project wins have bolstered the contractor’s order book to US$568 ($820) million at March 31 from US$374 ($540) million three months earlier.

They include helping build a lithium hydroxide plant for Albermarle in the South West and working on BHP’s South Flank iron ore project in the Pilbara.

“We will go into FY2020 with a focus on continuous performance improvement across all aspects of the business,” Mr Tallon said.

Construction of Civmec’s US$55 ($80) million shipbuilding facility was on schedule for completion in late 2019, the company said.

The facility will host construction of 10 offshore patrol vessels for the Royal Australian Navy led by prime contractor Luerssen.