RUNGE RESULT ‘DISAPPOINTING’
Written on the 13 September 2010
RUNGE Limited (RUL) managing director Tony Kinnane (pictured) is forecasting growth for the mining technology company in 2011, following a ‘disappointing’ $2.3 million NPAT result announced today.
“Our result this year is very disappointing,” says Kinnane.
Kinnane cites strong international business activity as key drivers of growth with recent expansion into Mongolia and Russia, but local uncertainty led Runge to restructure staff.
“Some people were let go, there was natural attrition and some were retrenched, people from areas with low level activity to high level activity like Beijing - the other thing we’ve done is pull multi-disciplined teams together from multiple offices,” he says.
“The domestic business has already picked up a bit but I’m not sure how much it’s got in it. I’m not particularly bullish on the global economy either and I think it’s still got another 12 months to sort itself out.
“I think it will take its natural course and sort itself out, but I don’t think there’s going to be any hockey stick uplift.”
He says cost containment will be another focus in FY11 by avoiding wastage in capital expenditure and travel expenses, but he is happy to spend money building relationships in the emerging markets of Asia.
“We have a target market for mines with $100 million revenue plus and for us we’ve probably tapped 18 to 20 per cent at this stage .The Australian market is higher than that, but there’s still opportunities.
“We don’t have a great presence in India at the moment and that’s going very well, and in Vietnam I’m very bullish as well.”
Runge will also be looking for opportunities in Mozambique’s coal industry and the growing resource market in Kazakhstan.
He says profit growth is going to be modest this year.
“Anything significantly greater than is going to be a pleasure – I don’t have the percentages but it’s going to be where it should have been this year, I’d say similar to last year. “