dbl profit but sp down, page-3

Records topple at Swick
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Wednesday, 27 February 2008
Colin Jacoby

SWICK Mining Services has announced record first-half profit and revenue results and an upgrade to its full-year earnings forecast as the company continues to expand its drilling fleet.

Net profit for the half year to December 31, 2007 was $A3.3 million, a 25% ramp-up on the previous corresponding period, while revenue was $34.8 million, up 112%.

The Perth-based company also upgraded its full-year revenue guidance from $80 million to at least $84 million, a 5% increase.

Swick managing director Kent Swick said the increase in first-half revenue was driven by the continued roll-out of new underground diamond drill rigs.

“During the half we added seven new underground rigs and two near surface diamond rigs,” he said.

“We also have financing and the engineering capability in place to significantly expand the Swick fleet in the next 18 months.”

The company has a fleet of 38 rigs and plans to grow this to more than 90 rigs by the end of financial year 2009.

Swick said most of the company’s revenue came from production drilling at mining operations as opposed to pure exploration drilling at greenfields projects.

He added that Swick was focused on growing its underground diamond drilling division, which was the company’s primary revenue contributor.

During the half year, the company inked a number of new or upgraded contracts for its underground diamond drilling division, including contracts with Consolidated Minerals, Oxiana, Jubilee Mines, Barrick and Silver Lake Resources.

New or upgraded contracts were also signed for the reverse circulation drilling division with ConsMin and Territory Resources, while the surface mining division signed contracts with Newmont Gold, Silver Lake Resources and Hill End Gold.

Shares in Swick closed the day 3.5c lower at $1.36.