Sedgman Ltd, the Brisbane- based resources services group has shown there is light after the great mining investment crash.
The company yesterday surprised the market with a juicy earnings upgrade (the company had reported a solid first half profit back in February) for the 2014-15 financial year rebounding solidly back into the black after the loss the previous year.
Sedgman told the ASX that it “expects the FY2015 reported result to be a net profit after tax in the range of $16 million to $17 million (FY2014 $7.7 million net loss after tax)”.
"The key contributing factors to the improved FY2015 result are the continuing disciplined focus on cost control across the business, the strong performance of both the Projects and Operations businesses with the award of $292 million of EPC Project work and the renewal of operating contracts at Mount Isa, Agnew and Sonoma during the course of FY2015, and resolution of contractual claims from completed projects.
"These estimates are preliminary and remain subject to finalisation by the Company and external auditors. Full details will be provided when the Company reports its full year results on 27 August 2015,” the company said.
The result points to a solid improvement in the second half of the year. In February, Sedgman said net profit jumped 169% to $4.6 million. The company paid an interim dividend of 3.5 cents a share (which was up from 2 cents in the previous interim period).
That’s pointing to a solid final dividend for the current year. So the question is for investors, is this a one-off confined to Sedgman, or will there be similar rebounds reported by its peers such as WorleyParsons, Cardno, Monadelpheous and ALS (later in the year)?
Sedgman shares leapt 14.8% to 77.5 cents yesterday to take its rise in the past year to 56%.
