Mining equipment maker Bradken shy on investments despite record profit
Australian mining and industrial equipment maker Bradken said it would take a careful approach to spending in the face of "limited visibility" caused by the global economic woes.
For the year ending June 30, Bradken reported net profit of $105 million, a whooping 49% increase from $71 million in the same period for 2011.
The company said its profit after tax went up by 15% after minorities, which consisted of write-downs in goodwill of some UK assets.
Despite beating market expectations and its record order book, Bradken said it would limit capital expenditure to committed projects, and that spending in the second half of 2012-13 would "depend on the outlook".
"We don't have a lot of visibility," managing director Brian Hodges said. "Coal markets to me appear to be disproportionately impacted . . . what I'm thinking and hearing is, there might be a slowdown and if you've got a choice of which energy form you use, you may not choose coal."
Earnings before interest, tax, depreciation and amortisation rose 12% to $232 million on a 26% increase in sales to $1.53 billion.
“We are seeing continuing growth of mining markets and have added capacity to our foundry operations in Australia, Malaysia, Canada and the USA to meet the increased demand for cast steel products," Hodges said in the statement.
The company has a record number of orders, meaning it would likely operate at full capacity for the first six months of the 2012/13 financial year, he added.