Boom Logistics halves loss

Australian crane rental company Boom Logistics posted a net loss after tax of AUS$ 36.9 million for its financial year ended 30 June 2015. It is approximately half the net loss from 2014 which was AUS$ 79.5 million.

Impairment charges of AUS$ 6.3 million for assets up for sale, AUS$ 14.5 million on assets in the fleet, restructuring costs of AUS$ 5.9 million and AUS$ 0.2 million for legal costs were included in the results. Without them, Boom’s earnings before interest and tax was a loss of AUS$ 6.3 million, compared with a profit of AUS$ 13.9 million in 2014.

Brenden Mitchell, Boom CEO, said "Our key initiatives for profit recovery in FY16 reflect the strategies we have developed and executed over the past two years. Whilst we expect market conditions to continue to be challenging, we will remain focused on the profit recovery programme in FY16."

For the first half of the 2015 financial year, to 31 December 2014, Boom said that revenue and profitability were negatively impacted by lower levels of contract maintenance business in Western Australia, Central Queensland and New South Wales; price pressure in highly competitive markets; and project delays in the telecommunications and energy sectors. Next came temporary closures of mines due to falling commodity prices, cancellation of maintenance contracts and reduced activity in markets for the heavy lift division.

In response to the falling market Boom shed 147 jobs (19%) of the workforce and sold surplus assets for AUS$ 20.3 million, among other activities.

The company forecasts the challenging trading conditions to continue for the next 12 to 18 months.