(Adds context and detail)
WELLINGTON, March 20 (Reuters) - New Zealand's Fletcher Building Ltd (FBU) on Monday cut its earnings guidance by about 13 percent and said losses had mounted at two major construction projects.
The downgrade by New Zealand's biggest construction and building supplies company comes even though construction is booming and underpinning national growth .
New Zealand has one of the fastest-growing economies in the developed world, which is supporting a construction boom as record migration boosts demand for housing.
But Fletcher Building said in a statement it expects full-year operating earnings between NZ$610 million and NZ$650 million ($428-$456 million), compared with a NZ$720 million to 740 million range forecast a month ago.
"The revised guidance is due to the identification of additional estimated losses and downside risk in the Buildings and Interiors business unit of the Construction division," the statement said.
"We don’t think these issues are systemic because they are primarily related to program and design challenges on a small number of major projects," the statement said.
Fletcher flagged losses at one unnamed major construction project at its half-year results announcement in February, when it reported flat profit growth.
It now says those losses are larger than it had expected then and it has made provision for losses on one other major unnamed project as well.
Fletcher had also previously reported a slowdown in the pace of reconstruction work at Christchurch, as most residential repairs and rebuilding since the deadly 2011 earthquake are now completed.
The downgrade announcement was made before the New Zealand stock exchange opened on Monday. ($1 = 1.4265 New Zealand dollars)
