Macmahon Holdings have managed to keep on the best side of their $135 million declared impairment, with a $112.5 million loss for the half year.
Underlying net profits for the half year to December 2014 came in at $11.3 million, after revenue of $384.3 million, which was down on the previous period’s revenue of $550.1 million.
The already troubled Macmahon took a devastating blow last week when Fortescue Mining Group declared they would consolidate Christmas Creek operations with Downer EDI, a loss of $260 million in future revenue.
Macmahon’s revenue forecast for FY15 is between $600 and $700 million, down from the previously expected $850 million.
Macmahon chairman Jim Walker said the company was focussed on improving performance across existing contracts, and seeking new opportunities to enhance profitability.
“We are looking at every opportunity to improve our productivity and reduce costs. We are currently in the process of streamlining our business in line with the changing conditions to ensure that we are operating as efficiently as possible,” he said.
“Mining is cyclical and it is important to remember that over the company’s long history, Macmahon has successfully adapted to changing market conditions through many cycles.
“We have a healthy balance sheet that is underpinned by world class assets and a low gearing ratio of 11.3 per cent. This gives us a strong foundation to work from.
“We are actively pursuing new work in Australia and overseas and our strategy is to target a broader range of opportunities where we have a competitive advantage.
Walker said discussions about payment in arrears were ongoing with Mongolian client Erdenes Tavan Tolgoi.
“The agreement we have in place with our client in Mongolia protects the positions of both parties while we undertake negotiations,” he said.
“We are diligently working through this issue and are pursuing all options available to us to resolve this issue as quickly as possible.”
Macmahon Holding Limited (ASX:MAH) is trading at 0.034c, having fallen from a one year high of 0.14c in August last year.