Delays force Resource Equipment to lower expectations

Resource Equipment has lowered its profit guidance for this financial year, placing the blame on unexpected delays in major companies’ decision making.

The Perth-based mining services firm said it expected full year EBITDA to come in at $21 million, with pre-tax profit of $13 million, after bidding on a record amount of work in the first half of the year.

The company lodged first half profit of $6.5 million.

Revenue at Resource Equipment’s core pumping business has remained largely steady since November 2011, growing from $4.6 million to $4.8 million.

Resource Equipment chief executive James Cullen said delays in decision making and a void in new project work had contributed to it lowering its forecasts.

“It is difficult to identify any single reason for the various delays, but it is worth noting that many other mining service companies are experiencing the same situation,” Mr Cullen said in a statement.

Mr Cullen said things were starting to move positively, with a number of contract decisions handed down in recent weeks.

“These have all gone in our favour and now give us the ability to recommence the growth momentum that has been recorded over recent years,” he said.

AT 1:50PM, WST, Resource Equipment stocks had gained 2.7 per cent, trading at 38 cents.