Mining market difficulties hit Boart Longyear

Drilling equipment and drilling services company Boart Longyear saw its revenues fall -39% last year to US$ 1.22 billion. The company recorded a net loss of US$ 620 million – a margin of more than -50% - with restructuring and impairment charges of US$ 461 million.

Despite the difficult results, the company accentuated the positives in its financial statement. “In spite of 2013 being an extremely challenging year for the global mining industry and the company’s core markets, the company generated US$ 107 million of adjusted [earnings before interest tax depreciation and amortisation] EBITDA and held net debt relatively flat.” It added that US$ 4212 million of its US$ 461 million accounting charges last year were non-cash.

The company’s products division, which makes drilling equipment and consumables for the construction and mining industries, saw revenues fall -38% last year to US$ 306 million. “Revenue and EBITDA for the Products division declined through the year until stabilising in the second half of 2013 (apart for the typical seasonal decline the business experiences around the holiday period),” said a company statement.

“The Products division’s results were impacted by low rig utilisation rates among its customers, who continued to de-stock throughout the year and appear likely in 2014 to hold only minimal levels of inventory necessary to support their on-going operations,” it added.

The company has not provided a market outlook for its revenues and profits this year, citing market uncertainty.