Foster Wheeler unable to continue?

NEW YORK, April 12 (Reuters) - Engineering and energy group Foster Wheeler Ltd., said on Friday its auditors have questioned its ability to continue as a going concern, and said it is revising fourth-quarter results to reflect a wider loss. The company -- battling the wave of asbestos-related lawsuits that have crippled earnings and share prices at many U.S. companies -- also said that it plans to revise its earnings guidance downward during a conference call on May 1.

Foster Wheeler revised fourth quarter results due to further cost overruns in one of its business units, a spokesman said. The company would not identify the unit. The company, which is working with its bank group to revise its credit agreement, adjusted its fourth-quarter net loss to $319.3, or $7.81 per share. Foster Wheeler said adjusted results include $29.9 million in charges, which is in addition to a $101.5 million charge reported earlier. The company had previously reported a fourth quarter net loss of $273 million, or $6.68 a share.

Foster Wheeler, based in Hamilton, Bermuda, also said its auditor had issued a "going concern" opinion based on the unresolved negotiations with the company's creditors.

Foster Wheeler said it is in discussions with lenders and other institutions about a new long-term credit facility, and the replacement for its lease financing and receivables sale arrangement. The company's $270 million long-term revolving credit agreement is due to mature in February 2003, Moody's Investor Services said on March 8. On Friday, the company said it had obtained an extension of its waiver under its revolving credit facility through April 30, subject to some ongoing conditions.

In early March, Moody's downgraded the company's debt to B3 from B1. Moody's said the rating action reflected concerns that the company was relying on its bank group's willingness to extend near-term debt maturities. Moody's also said that the negotiations with its bank groups may go long. The company's shares fell $3.45 to $2.80 on the New York Stock Exchange on Friday, sharply off 52-week highs of $16.96.

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