Following-on from today’s profit warning and announcement of job losses from Transfield Services, which follows similar announcements last week by Coffey, UGL and Worley Parsons, drilling contractor, Boart Longyear, has today lowered its earnings guidance and amid slowing mining activity. From the AFR:
Drilling contractor Boart Longyear has said its revenue and earnings will be at the low end of analyst forecasts, which have already come down significantly this year as the company struggles with a weakening mining market…
The company, now led by former Newmont Mining chief executive Richard O’Brien, said it had cut 1000 jobs since the start of the year on top of other cuts in 2012 – bringing its headcount below 8000. In mid-May last year it had 11,400 employees…
“The downturn in capital and exploration spending in the mining sector has clearly reduced the demand for drilling services and products”…
Boart said commentary from major miners and industry analysts suggested exploration drilling activity had fallen by 20 per cent over the past year, with many projects deferred indefinitely. But it said areas like production support, underground coring and mine de-watering, which generated 40 per cent of drilling services revenue in 2012, were proving more resilient.
