21/12/2015 - 15:20

Boom flags $18m impairment

21/12/2015 - 15:20

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Crane hire company Boom Logistics has flagged an $18 million impairment in its half-year profit, with a portion of the write-down relating to costs associated with the shutdown of its transport business in the Pilbara.

Crane hire company Boom Logistics has flagged an $18 million impairment in its half-year profit, with a portion of the write-down relating to costs associated with the shutdown of its transport business in the Pilbara.

In a statement today, Boom said it intends to book a non-cash impairment charge of about $12 million against the carrying value of its operating fleet, and a non-cash impairment charge of about $6 million against non-core assets that it has branded for sale during the second half of the year.

About $3 million of the latter impairment relates to non-core transport assets that have been released for sale after Boom closed its loss-making transport business based at Port Hedland's Wedgefield industrial estate, coupled with the outsourcing of its transport business formerly based in Singleton NSW.

The company expects earnings before interest, tax, depreciation and amortisation to be between $6 million and $7 million before restructuring and one-off costs; an improvement on the $4.1 million EBITDA achieved during the second half of FY15.

Boom has realised over $11 million in asset sales during the first half of FY16, with the proceeds being applied to repay debt.

“The company does not forsee any significant upswing in the resources sector in the short term,” Boom said in a statement.

“The company is however continuing to aggressively compete for new work particularly in the renewable energy, infrastructure and utilities markets and is continuing to reshape its labour arrangements to reflect the current trading conditions.”

Boom’s first-half results will be released around mid-February.

Shares in Boom were 4.5 per cent higher to 9.2 cents each at the close.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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