PROFITS FOR SEDGMAN AND INDUSTREA
Written on the 13 September 2010
MINING services companies Sedgman Limited (SDM) and Industrea Limited (IDL) have both announced profit rises today for FY10, with strong international sales and positive outlooks for 2010.
Milton-based Sedgman recorded a 252 per cent boost in net profit after tax profit (NPAT) to $25 million, while Industrea recorded an 8 per cent rise to $49.1 million.
Sedgman managing director Mark Read (pictured) says the company’s order book now stands at $706 million, with staff numbers up 17 per cent to keep up with increased demand.
“Our international expansion strategy is delivering substantial benefits. We are securing major engineering, procurement and construction (EPC) projects and our order book and pipeline of targeted projects are now at record levels,” he says.
“Sedgman’s order book now stands at $706 million and has increased by $176 million over the past 12 months. Targeted projects in our three-year pipeline have increased by $1.5 billion to $6.3 billion.
“We expect to achieve further growth in our order book and to capitalise on the increasing number of coal and metals project opportunities in both Australia and overseas.”
Industrea’s diesel equipment and technology division doubled its export sales to $136 million in FY10. CEO Robin Levison highlights the important role China has played in the result.
“China’s expansionary coal sector, which is growing at around 9 per cent or 300 million tonnes per annum and the government’s mandate to significantly lift underground mine productivity and safety drove another outstanding performance by our diesel equipment and technology business,” he says.
“Our position as a supplier of choice to an increasingly diverse group of China’s leading coal producers for specialist longwall roof support carriers, methane gas drainage and collision avoidance systems generated on average about $10 million per month in new contract wins throughout the year.”
Industrea is currently developing a flameproof and explosion-proof personnel and materials vehicle exclusively for China’s underground coal mining market, with completion expected mid-2011.
Levison also points to opportunities in the emerging markets of India, Indonesia and Russia.
“Similar to China, India is also undertaking a vigorous modernisation and urbanisation program. Accordingly, we are targeting India’s rapidly expanding underground coal sector’s demand for mechanised safety and productivity equipment,” he says.
“We are also receiving increasing enquiry levels from Indonesia and we view this market as a primary target with its domestic thermal coal production increasing rapidly to fuel escalating domestic consumption and exports to Asia.
“Whilst our focus will remain squarely on driving organic growth through these widening market opportunities, we are continuing to investigate opportunities where bolt-on acquisitions can add immediately accretive value to our proven business model.”
SDM shares rose 2.8 per cent this morning to $1.65, while IDL shares rose 4.4 per cent to $0.355.