CP Ships lowers profit expectation

CP Ships lowers profit expectation

   CP Ships gave more bad news to its stockholders today, when it said it has lowered its profit expectation for 2004 due to severance costs and unusual charges.

   Instead of a net income of about $82 million predicted in November for 2004, CP Ships now expects its net income to be in the $70 million to $73 million range, before unusual charges of $5 million.

   “The unusual charges are for legal and other costs of the board’s special committee review of the August 2004 restatement and for costs of the departure of the former CEO in December 2004,” the Canadian-registered company said.

   CP Ships’ CEO, Frank Halliwell resigned in December because of what the company described as “differences with the board on future direction of the company.”

   The shipping company also said its fourth-quarter operating income before unusual charges will likely reach a record level, but did not disclose the company’s expected net income for the quarter.

   CP Ships plans to report its 2004 fourth quarter and annual results Feb. 10.

   The company made the announcement on its lower profit expectation before the opening of the New York and Toronto stock exchanges today. The company’s stock still trades at about 25 percent less than its August 2004 level, when it announced it had overstated its previous financial results.