Continuing weakness in commodity markets and a failure to pay staff adequate superannuation will combine to take a $5 million chunk out of Matrix Composites & Engineering’s expected earnings for the 2013 financial year, the company says.
The Perth-based resources services company, which primarily services the oil and gas sector, said today it expected earnings before interest, taxation, depreciation and amortisation (EBITDA) of around $8 million for FY2013, after flagging earlier this year it expected to report EBITDA of $13 milllion.
A shortfall of $2 million was the fault of lower than anticipated sales volumes, Matrix said, while the company had to contribute an additional $2 million in superannuation contributions because it had inadvertently excluded overtime payments from July 2010 to June 2012.
The decline in spending and widespread project deferrals across the state is expected to result in a $500,000 EBITDA hit, while a further $500,000 reduction occurred because Matrix’s maintenance and operating costs came in over budget.
“While the revised guidance is disappointing, and below previous expectations, the board considers that market conditions have improved, as evidenced by the strength in the buoyancy order book and the continued strengthening of the US dollar,” the company said in a statement.
Matrix said it continued to win major contracts in the drill ship market, and the company’s 2014 order book was in a healthy condition.
At close of trade today, Matrix shares were up 0.6 per cent, at 82.5 cents.
