Downer EDI has flagged it will continue with a raft of cost-cutting measures in it’s mining division after announcing a lower than expected net profit after tax.
In an announcement released yesterday the company said that Downer Mining’s total revenue declined 20.4% due to the end of their contract at Daunia and the early termination of the Goonyella contract.
The company statement also said, “There were also fewer opportunities for the blasting business and discounted pricing of Ammonium Nitrate supply, which placed further pressure on earnings.”
Overall Downer produced a net profit after tax (NPAT) of $94.7 million for the six months to 31 December 2014, 4.4% lower than the prior corresponding period.
Earnings before interest and tax (EBIT) was $141.7 million, down 11.5%, and revenue was 8.8% lower at $3.6 billion.
Chief Executive Officer of Downer, Grant Fenn, said it was still a “solid result” in a difficult year.
“Mining based construction and services markets remain subdued,” Mr Fenn said, “Our mining related consultancy businesses were hit particularly hard and experienced financial losses.
“We continue to respond to the tough market conditions by working closely with our customers to drive productivity and reduce costs.”