Heavy Civil losses were much greater than expected this quarter, driven by higher than anticipated costs from certain projects in the Northeast where this region's loss before income taxes was approximately $3.5 million, with the remainder coming from continued completion of older projects. We have made meaningful progress against our stated goal of working through older projects that do not meet our profitability expectations. At the same time, we have secured new projects at Heavy Civil with higher associated margins, including a new, $80 million project in Cudjoe Key, Florida. Although the completion of legacy projects continues, the vast majority of Heavy Civil's current backlog entering FY 2014 reflects projects we expect to complete at improved margins. Performance and execution will be the keys for returning this segment to profitability.
Other non-cash costs in the quarter were due to a further pruning of product lines that do not support our strategy to address the significant water needs of the U.S. oil and gas market. We are beginning to negotiate our first sizeable contracts in the energy sector and are extremely excited about the potential we see in this market. Our move to The Woodlands, Texas is progressing as planned and, as a result of previously announced executive changes, certain severance and other costs were also incurred in the quarter."
--Rene J. Robichaud, President and Chief Executive Officer
The loss before income taxes in Q4 FY 2013 is expected to be between $34 million and $38 million. These losses are expected to be attributable to, among other things: a) losses at Heavy Civil, between $10 million and $12 million, as this business continues to work through several unprofitable contracts that are experiencing cost overruns; b) aggregate losses of between $13 million and $14 million at Geoconstruction, Water Resources, and the new Energy Services initiative, including the above-referenced non-cash, pre-tax charges totaling between $6 million and $8 million; and c) non-recurring severance and other expenses of approximately $4 million pertaining primarily to the move to The Woodlands, Texas. The expected loss at Mineral Exploration will be approximately $1.0 million, as a result of the factors noted above, ongoing civil unrest in Mali, and increased price competition from some of the Company's competitors.
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