Maca delivers solid result

Welshpool-based Maca has posted a slight fall in profit for the financial year but increased revenue by 1 per cent, despite it being a tough time for contractors and mining services companies in the current market.

Maca reported a 1.8 fall in net profit to $54.4 million, with revenue up to $601.4 million.

The company declared a final dividend of 7.5 cents per share to bring its full-year payout to 39.5 cents, fully franked. That’s a 10.2 per cent fall on last year’s payout.

Maca’s order book fell 6.4 per cent to $1.22 billion, but operating cash flow rose 292 per cent to $136.5 million.

“The full-year earnings result demonstrates the strength of Maca’s business, despite what has been a very challenging operating environment for the mining and civil sectors due to weak commodity prices and poor market sentiment,” the company said.

“Operational activities have rebalanced away from iron ore with contract wins in Brazil with Beadell Resources and Avanco Resources.

“This increased geographical presence and experience, coupled with a strong balance sheet, has Maca well placed to secure further opportunities,” it said.

During the year, Maca struck a deal with Atlas Iron to continue operations at the iron ore miner’s Wodgina and Abydos mines in the Pilbara.

Looking ahead, Maca flagged cost reductions to align with revenue, which it has forecast to decline to about $450 million by the end of FY16.

“Market conditions for the mining and civil service sectors remain challenging and are likely to remain so until there is a sustained improvement in commodity prices and consequential uplift in mining activity,” Maca said.

Of the forecast $450 million revenue result, Maca said about 85 per cent is already contracted.

Maca shares were 1.2 per cent higher to 83.5 cents at 1:45pm.