Blue chips help MAC buck trend
10/02/2009
The Australian
AAP
Results MINING accommodation and services company The MAC Services Group says its exposure to blue chip clients and the right mines has helped to lift its first-half profit.
The company increased its first-half dividend by 21 per cent on the first half of 2008 as a result of a strong performance, despite tough market conditions that will continue into the second half.
Net profit to December 31 was up 34 per cent on the previous corresponding period at $12.1 million. Revenue was up 39 per cent on the same period at $53.4 million.
MAC Services chief executive Mark Maloney said the strong results were due to a lowly geared balance sheet, strong contracts and continued exposure to major blue-chip clients.
``We do a lot of work to make sure we're exposed to the right mines,'' Mr Maloney said.
``Our contracts are in place and given the long-life, low-cost mines that we're exposed to, we should be in good stead. ``We've learned from experience ... that you've got to keep a fairly conservatively geared balance sheet. ``You've got to have strong contracts in place that underwrite the business and you've got to keep your exposure to the major blue-chip clients.''
Mr Maloney said shutdown and maintenance work in mines would also help second-half profits.
``There's been a lot of maintenance and shut-down work that's been neglected over the last couple of years. ``There's a lot of catch-up maintenance happening and there is also a lot of maintenance being put forward so there will be a level of activity over the next six months, driven by maintenance.''
MAC Services said that despite production cutbacks announced by some resources companies, it had yet to experience a significant negative effects.
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