MADRID (Reuters) – The Spanish infrastructure group OHL Wednesday reported a fall of 18.7% in net profit in the first quarter, affected by a lower contribution from its Business rodoviario (road transport) in Mexico, where the company is investigating allegations the Government Surcharges.
OHL Mexico’s shares have fallen 20% since recordings appeared on YouTube in which executives can be heard discussing overcharge for public works.
The company launched an investigation into the matter, but states that it acted illegally and that the recordings were edited to distort its content.
The governor of Mexico state ordered an audit to ensure that OHL Mexico meets the terms of its contract rodoviario.
The Mexican business accounts for 72% of underlying profit of OHL and its performance depends heavily on the country’s inflation rate, which was 0.51% between January and March, compared to 1.43% ago one year.
This factor caused the group net profit down to 49.1 million euros (55.3 million dollars) compared to 60.4 million euros last year.
The figure bounded weighed on earnings before interest, taxes, depreciation and amortization (EBITDA), which fell 5.4% to 263.9 million euros.
The negative impact more than offset the growth of the engineering and construction division, where EBITDA rose 36%, as well as other roads in Latin America and Spain, where the Spanish are using their cars to more falling gasoline prices and an economic recovery.
On Wednesday the titles of OHL Mexico earn 0.67%, to 24.65 pesos per share, according to data from the Mexican Stock Exchange (BMV). In Spain, OHL shares fall 0.37% to 18.83 euros per share.
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