While Mastermyne’s clients had been under pressure to reduce costs in a more challenging environment, any loss of work hfor Mastermyne had been offset by gains at other sites, he said in the company’s annual report.
“During this period of rationalisation across our sector, we will inevitably be presented with or become aware of growth opportunities by way of acquisitions,” he said.
“Whilst the organisation is not currently in negotiations for any material acquisitions, it is prudent for us to keep abreast of any opportunities that will enhance our operation and shareholder value.”
Caruso said the coal sector had moved from the boom cycle to a more subdued environment as a result of rising costs, the Australian dollar and declining coal prices.
“As a result of this market slowdown we have seen increased pressure to reduce costs, reduced utilisation of equipment and manning reductions on some projects,” he said.
“At this stage any reductions have been offset by gains on other sites.
“A number of new mine construction projects have been deferred or cancelled but it is important to note that these projects were not supporting our current contract order book.
“Mastermyne has always been inextricably linked to operating underground mines and the services provided by the company are directly tied to the production of coal.
“It is these contracts that we continue to service and focus on.”
Caruso said Mastermyne’s tender pipeline remained in good shape and it was not experiencing any drop in tendering opportunities.
“Our customers [will] work to reduce their costs by tendering to organisations that offer good performance, robust operating systems, established industrial relations and who are invested in the long-term future of the underground coal sector,” he said.
“I am confident that we will continue to see strong tendering opportunities as the sector rationalises and moves away from its use of small to medium-sized underground coal contractors to larger contractors like Mastermyne, however, we also expect the market for new contracts to be increasingly competitive.
“We will continue to work closely with our customers to deliver a valuable service at a reasonable price.
“This ability to partner with our customers, for the long-term benefit of both Mastermyne and our customers, is what differentiates the Mastermyne Group from the opportunistic contractors that have thrived simply from the boom scenario.”
