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While Mastermyne’s net profit after-tax result of $11.5 million for the year was down 27%, the company is still securing new work and managing its existing contracts profitably, managing director Tony Caruso said.
“Delivering this result in a challenging market was a strong reflection of how well the company is positioned in the underground coal sector,” he said.
“Our leverage to production versus construction and maintenance has seen the company deliver a result that has only been surpassed by the record high result of FY2012.
“FY2014 will continue to provide a challenging backdrop for mining services companies, however Mastermyne is well-positioned with a strong order book totalling $236 million – of which $112 million will be delivered in FY2014 – traditional uncontracted recurring work of $30 million per year and approximately $20 million of contract renewals contributing to FY2014.”
During FY2013, the company has maintained the contracts that made up the order book at the half-year, despite the cost reduction actions taken by coal producers.
“We have experienced some minor contraction on existing contracts, but conversely the order book has benefited from the addition of the Appin Area 9 and Kestrel Mine Services contracts which were mobilised during the second half of the year.
“Pleasingly, this year we have seen strong contributions from the engineering and services divisions, which have supported the FY2013 result.”
More recently, the company has secured $65 million in new contracts with approximately $30 million deliverable in FY2014.
“These new contract wins late in the financial year provide a strong platform to build FY2014 revenue and importantly, replace revenue from the scheduled run-off of the Kestrel Mine Extension Project, which has now been transitioned from Rio Projects to Operations,” it said.
Redeployment some of the fleet that was engaged on the Newstan contract for Centennial Coal is underway, with two continuous miners on hire with the third unit undergoing an overhaul in preparation for hire opportunities.
