Bradken shares crash as mining engineering company sinks to $93m loss
By finance reporter Simon Frazer
Posted 8 minutes agoTue 10 Feb 2015, 11:03am PHOTO: Bradken has cut its global workforce by more than 10 per cent in the first half. (Chook Brooks: ABC News) MAP: Australia
Shares in metals processor Bradken have crashed after the firm reported a $93 million loss for the six months to December.
Bradken advised investors of the net loss before the local market opened this morning, compared to a $38 million profit in the same period a year earlier.
Traders were quick to react when the Australian share market did open, sending Bradken shares down more than 23 per cent in the opening minutes.
Bradken was trading around $2.40 a share, compared to $15 a share in late 2007.
In the most recent half sales revenue dipped 12 per cent to $495 million, with profits hurt by weak commodity prices and restructuring costs as Bradken seeks to adapt to the drop off in mining investment.
Bradken makes a wide range of metal products, mainly for use in the mining and transport industries, and has been hit hard by the steep downturn in capital expenditure by the resources sector.
The company said restructuring has so far cost Bradken $47 million, plus plant and equipment impairment of $51 million.
Today's share price reaction is the second sharp fall in less than a month.
In January the firm's stock dropped 30 per cent after Bradken advised that a takeover bid from US private equity firms Bain Capital and Pacific Equity Partners had fallen through.
Bradken today advised it has been able to cut its global workforce by more than 10 per cent in the first half, to just over 4,400 employees.
Chief executive Brian Hodges has advised that a turn-around by Bradken will be gradual.
"We expect a slight increase in overall sales revenue in the second half, with an incremental improvement in margins," he said in the statement accompanying the results.
PHOTO: Bradken has cut its global workforce by more than 10 per cent in the first half. (Chook Brooks: ABC News)
