Bradken narrows loss, claims return to stability
The mining services firm has narrowed its full-year loss to $196m and ended the year “positively”.
Mining services provider Bradken has narrowed its loss for the full year, spruiking a stabilisation in its business through the second half.
The ASX-listed group (BKN) reported a $195.9m loss for the year to June 30, an 18.8 per cent improvement on fiscal 2015 due to a reduction in impairments and restructuring charges.
Bradken said its underlying earnings dipped 13.1 per cent to $29.5m on the back of a 15 per cent slump in sales revenue to $820.6m.
The group’s underlying pre-tax earnings weakened 20.4 per cent to $108.4m.
“After a challenging first half, the 2016 financial year ended positively for Bradken,” the company said.
“While the likelihood of a resurgence of the global mining capital market remains uncertain, and despite a significant falling away of rail capital and maintenance sales and reduced demand from energy markets, trading conditions stabilised.”
Bradken chief executive Paul Zuckerman added the group had met its targets for the second half as restructuring moves, which were further enhanced in July, made an impact.
“We have achieved a solid full year result and delivered on targets set at the half year, despite continued subdued market conditions,” he said.
“Earnings during the second half exceeded the first half as divisional revenues stabilised and Bradken executed on our disciplined approach to reducing overhead costs.”
The company saw no significant change to commodity markets for the year ahead, ensuring capital expenditure would remain at depressed levels, although stability in earnings is forecast.
“The fundamentals in the mining industry remain stable and while capital growth is not expected to return until FY18, underlying global run-of-mine output is growing steadily,” Bradken said.
“Management expects FY17 underlying EBITDA to be in line with reported FY16 underlying EBITDA, based on current market activity.”
The recent restructure moves were seen improving cash flow and its endeavours to reduce debt.
Bradken again offered no dividend to shareholders.