Drilling services company Imdex has posted significant profit fall for the year ending June 30, which the company attributed to the impact of the global financial crisis and the downturn in mineral exploration.
Drilling services company Imdex has posted significant profit fall for the year ending June 30, which the company attributed to the impact of the global financial crisis and the downturn in mineral exploration.
The company posted a net profit for the year after tax (NPAT) of just over $12 million, a drop of 62 per cent on last year's NPAT which climbed above $32 million.
However, last year's $32 million NPAT figure included non-operational items, including the sale of the company's Surtron business for $12.1 million.
This year's result signals a return to NPAT similar to that reached in FY 2007 when the company recorded $13.5 million NPAT.
Interestingly, this year's net profit after tax (before non-operational items) was $11.3 million, eclipising the $11.1 million reached by the company in FY 2007 yet falling short of last year's net profit after tax (before non-operational items) of $21 million.
The company's revenue from continuing operations (excluding interest income) fell four per cent to $137 million this year as compared to $142 million last fiscal year.
This recent revenue figure outshone results from FY 2007 of $103 million.
Imdex managing director, Bernie Ridgeway said while earnings were down the company's strong balance sheet and resilient earnings reflected the success of Imdex's focussed strategy and ongoing investment in research and development.
Looking ahead, Mr Ridgeway said "the company viewed the third quarter of FY09 as the trough in the cycle, with the fourth quarter of FY09 showing signs of recovery."
Key base metal prices have recovered from lows and positive sentiment from customers indicates that exploration spending and drilling activity should gradually trend upward in FY10.
The medium to long term market fundamentals remain very attractive due to long term supply and demand imbalances, and growing demand for energy and resources, particularly within the BRIC countries, driving exploration and production spending within both the mineral and oil and gas markets.
"Imdex's strategy for FY10 will remain unchanged from prior years. We will continue to grow the business globally and retain our position at the technological forefront through investment in research and development", Mr Ridgeway said.
Specific priorities for FY10 include:
- Further expansion into the global oil and gas market through the sale of industry specific fluids and rental/sale of down hole instrumentation;
- Growth of the DFC Division by marketing Imdex's solids control units to the global diamond drilling market;
- Expanding the rental business model for the DHI Division;
- Investment in research and development to consolidate Imdex's position at the forefront of its markets and facilitate further expansion into the global oil and gas market; and
- Building additional scale into all Imdex Group businesses and supporting global supply and distribution partners.
