REPORTING SEASON: Bradken Limited (BKN)

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Figure 1: Bradken Limited 12 month chart

 

Bradken (BKN) No surprises – full year loss and merger talks continue.

– Mining and engineering services firm Bradken (BKN) reported a net loss after tax of $241.3Million broadly in line with market expectations. There were no real surprises in today’s numbers as Bradken has been consistently updating the market over the last 6months with the details of its restructure costs, write-downs and possible takeover news.

– Bradken updated the market in late June by stating that they expected a FY15 underlying EDITDA of $136-$138Million and today posted $136.1Million in earnings. The result was impacted by restructuring and impairment costs while being boosted by one off property sales.

– Bradken’s sales fell by 14% to $965.9Million due to competition in rail wagon sales and the pullback in the mining sector, which impacted demand for BKN’s services and products. Bradken expects the rate of decline in the resources industry CAPEX to slow in the current financial year as the company has seen order intake trends improving.

– BKN said its restructuring is largely complete and its balance sheet has strengthened on the back of its $70Million Redeemable Convertible Preference Securities (RPS) to Sigdo Koppers and CHAMP. BKN said merger talks are continuing with the Sigdo’ Magotteaux Group – the current exclusivity period is set to expire on August 29.

– Bradken management agreed not to pay out a final dividend to shareholders in line with expectations.

 

You can see all of CommSec’s reporting season analysis by clicking here.

Juliana Roadley, Market Analyst,