Contractor MACA has announced a hit to earnings due to tightening margins in its core mining division, with its net profit expected to slump to between $7 million and $9 million for the half year to December 2018.
By comparison, the company posted a net profit of $12 million in half year to December 2017 and $11.6 million in the half year to June 2018.
The company released a market update this afternoon, after being placed in a trading halt earlier in the day.
“The tightening labour market has impacted the availability and deployment of equipment, which in turn has adversely affected site performance across our projects,” chairman Andrew Edwards told the company's annual general meeting this afternoon.
“We have invested in new and larger equipment and additional inventories however, due to equipment lead times the benefit of these investments is not expected to be realised until the second half,” Mr Edwards said.
"In addition there have been costs incurred in preparation for extensions and new projects for which we will not realise revenue until the second half."
The Welshpool-based firm said the consensus revenue forecast of approximately $300 million for the half year was expected.
Group revenue for the full year is forecast to increase by approximately 10 per cent to $620 million.
"Importantly, the revenue growth includes a significant, and deliberatly pursued, diversification component which both lowers MACA's overall risk profile and provides a broader platform to underpin future growth," Mr Edwards said.
