Emeco is set to add a $14 million package of “highly sought-after” underground mining equipment to its Pit N Portal rental business.
Without disclosing what’s in the package, Emeco revealed that the equipment was located in Australia and would be quickly deployed to its customers nationally.
The company plans to send the remainder of the equipment to its Force rental and maintenance workshops for maintenance and rebuilds before deploying them starting mid-2021.
The second-hand equipment was acquired at attractive prices and would boost Emeco’s investment profitability by more than 20 per cent.
The purchase agreement was made following an accelerating momentum within the Pit N Portal business along with growing demand for its underground mining fleet.
“Our ability to utilise Force workshops to enhance the value of this package allows us to take advantage of the strong customer demand for high quality underground equipment and deliver continued earnings growth,” Emeco chief executive Ian Testrow said.
Pit N Portal encountered project commissioning issues during the second half of last year but expects profitability to improve this year.
“We have navigated some productivity headwinds in the early stage works of some Pit N Portal long-term services contracts, and the team has acted decisively to quarantine and remediate the issues,” Testrow said.
“Activity levels at Pit N Portal continue to grow and we are seeing significant opportunities to expand our footprint in rental and mining services.”
Emeco flagged that there’d be start of new projects in the eastern region of Australia and strong growth in mining activities in the western region this year.
The company declared an operational earnings guidance of $235-$238 million for the 2021 financial year.