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SNC-Lavalin offices in downtown Montreal.Mario Beauregard/The Canadian Press

SNC-Lavalin Group Inc. says cost-cutting and a diversification strategy will help boost earnings in 2016.

The Montreal-based company said on Thursday it is targeting adjusted earnings per share of between $1.50 and $1.70 in its key engineering and construction division, up from $1.34 in 2015.

However, that outlook is weaker than expected, said Desjardins Securities analyst Benoit Poirier, who was looking for $1.66 while the consensus estimate was $1.77.

SNC provided the outlook as part of its fourth-quarter results.

Net income for the quarter was $49.2-million or 33 cents per share, compared with $1.14-billion or $7.51 per share in the year-earlier period, which included a net gain of $1.3-billion or $8.65 per share on the sale of the company's interest in Alberta-based electricity distributor AltaLink.

Excluding one-time items, fourth-quarter net income was 68 cents per share, beating the analysts' consensus estimate of 44 cents.

Revenue in the quarter fell to $2.65-billion from $2.8-billion a year earlier.

The backlog was also down: $12-billion at the end of December, 2015, compared with $12.3-billion. But this excludes the company's $1.3-billion share of the recently awarded $2.75-billion contract for a key portion of the refurbishment of Ontario's Darlington Nuclear Generating Station, as well as a contract – valued at about $800-million – for infrastructure and processing facilities in a Middle East gas field.

The company said on Thursday it is increasing its quarterly cash dividend by one cent to 26 cents per share.

"Despite the turbulent markets and persisting softer economic environment, we are entering 2016 with a strong balance sheet, a stable and diversified backlog, and a continued focus on improving performance that has yielded cost reductions from our 'STEP Change' program," president and CEO Neil Bruce said in a statement.

Mr. Bruce, who took over as president and chief executive officer from Robert Card last October, said on a conference call he would like to see a settlement over federal corruption charges related to business in Libya between 2001 and 2011.

A preliminary hearing is set to start in September, 2018, with a trial not likely to begin before 2020 or 2021, Mr. Bruce said. The company – which acknowledges there was wrongdoing but that it was by executives who have since left the company, and says it has undergone a sweeping overhaul of its ethics and compliance procedures – has stated it would prefer to avoid a prolonged legal battle and reach a settlement without admission of guilt.

"From a competitiveness perspective, I really do think that SNC-Lavalin and any other Canadian company who ended up in the same position as us is at a serious competitive disadvantage versus our U.S. and European peers," Mr. Bruce said.

SNC and any other Canadian companies in a similar situation of potential reputational damage should have access to "some form of deferred prosecution," he said.

In contrast to the United States and other countries, Canada does not offer so-called "deferred prosecution" or "non-prosecution" agreements which involve fines from companies facing bribery allegations while avoiding them having to face a trial or guilty plea.

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