Byrnecut sinks rivals
August 11 - 17, 2008
BYRNECUT Mining has won the contract to sink Australia’s deepest blind shaft as part of the $A590 million Perseverance Deeps project at the BHP Billiton-owned Leinster nickel operations in Western Australia.
Boart drills deeper into deal pipeline
July 7 - 13, 2008
BOART Longyear fan Credit Suisse likes the company’s estimated $US5-10 million acquisition of small Western Australian drilling product maker Westrod Engineering. While “immaterial” in the sense that it added about $US7 million a year of revenue, the deal underscored management’s confidence in their acquisition strategy and echoed the earlier successful purchase of another WA firm.
No contraction for contractors
June 23 - 29, 2008
A SLOWING Australian economy won’t put the brakes on revenue growth for leading engineering and construction contractors, including United Group, Leighton, Downer EDI and Transfield Services, according to JPMorgan, which sees most upside in the current share price of Transfield.
Boart still has a red and a blue corner
June 9 - 15, 2008
CATEGORICAL differences in assessment continue to exist between analysts covering Boart Longyear, with the performance of Canadian rival Major Drilling seen as a positive indicator for fans of Boart and a relative negative for those less enamoured.
Swick confident of deeper market entry
June 2 - 8, 2008
HALF of the good news is that what Randal Swick doesn’t know about the RC drilling business isn’t worth knowing. The other half is Brazil has very little in the way of RC drilling competition. The bad news is the Brazilian resources industry has been brought up on diamond drilling and “it’s a pretty slow wheel that turns”.
Fine results for MinRes
May 12 - 18, 2008
CONSOLIDATED Minerals Ltd may have disappeared from public view – and from one-time chief Michael Kiernan’s grasp – but the company Kiernan chaired until earlier this month, Mineral Resources, is still giving investors a decent ride on the coat-tails of the Pilbara manganese miner.
Boart-Layne merger not on
April 28 - May 4, 2008
LEADING drilling contractor and equipment manufacturer Boart Longyear has ruled out a heavyweight tilt at rival Layne Christensen’s mineral drilling business, saying its present strategy of acquiring smaller companies continues to produce sound results.
Layne gains
April 7 - 13, 2008
HIGHER gold and base metals prices helped North American driller Layne Christensen Company increase revenues from mineral exploration services by 19.9% to $US178.5 million in the 12 months to January 31, 2008, capping an altogether stellar year for the Kansas-based company.
The name game
March 31 - April 6, 2008
ONE way to reduce competition in the drilling business is to buy your rivals – a strategy being employed by Boart Longyear and other big international mineral drilling companies such as Major Drilling and Layne Christensen. Unsuccessfully in some cases, it seems.
Brandrill waits to determine order load
March 10 - 16, 2008
VERY little has been said about the outlook for Brandrill’s new lightweight dump-truck tray business since the contractor bought into DT-Hi Load Australia (DTA) last October and the reason is simple – there isn’t one at the moment, according to Brandrill managing director Ken Perry.
CHAMP takes Golding
March 10 - 16, 2008
QUEENSLAND’S buoyant civil and mining contracting markets will retain new private equity target Golding Contractors’ focus for the next few years, with one “packaging” option – a combination of Golding and underground coal services specialist Mastermyne – not currently on the boardroom whiteboard at CHAMP Private Equity.
Offshore growth looms for Swick
March 3 - 9, 2008
BELIEVE IT, or not: a listed mining service company genuinely focused on nothing but organic growth for the next 2-3 years, and possibly beyond. Swick Mining Services boss Kent Swick (in Sudbury, Ontario, when HighGrade spoke to him) wants us to believe. Others seem to have no problem with that.
Industrious group unearths more value
March 3 - 9, 2008
FAST-GROWING mining technology and services group Industrea Ltd’s latest acquisition is expected to double its earnings in fiscal 2008, as well as removing some of the lumpiness in cash flows from its existing capital equipment and technology businesses. Its new major shareholders will no doubt be pleased.
Driller aims to hit growth targets
February 25 - March 2, 2008
IF ROGER Jackson was head of an exploration company he would have reported last month a sweet, high-grade hit in the heart of the Cobar mining district. This month’s drill report would highlight very encouraging signs from work on the fringes of what could be one of the New South Wales copper-gold porphyry elephants.
Bank assumes lower Boart growth
February 25 - March 2, 2008
NO PRIZES for guessing what sort of a year it should be for drilling contractor Boart Longyear in 2008. However, achieving superior growth is far less straight forward.
Boart will buy more
January 14 - 20, 2008
EXPECT further Boart Longyear drilling acquisitions in emerging markets such as South America, Mexico and Eastern Europe following the company’s recent Patagonia Drill transaction.
Australians a cut above
December 10 - 16, 2007
BYRNECUT Mining is becoming increasingly fixated with Africa as the pivot-point in its aggressive international growth strategy, and it seems the feeling is mutual. One experienced Afrikaans miner was overhead uttering the unthinkable during a recent analysts’ visit to a site in Zambia. “Aussie underground contractors are the best in the world”, was the veteran’s affirmation.
Barminco working hard at depth
November 5 - 11, 2007
BARMINCO is building a board and foundations for international growth, not a platform for a 2008 float, according to new director and chief executive of co-owner Gresham Equity Partners, Roy McKelvie.
Driller result raises questions
October 22 - 28, 2007
CRITICS of the $A2.7 billion Boart Longyear float who saw the company’s Australian Securities Exchange listing as a possible “end game” for some parties involved in the delivery would have been nodding their heads at last week’s exit of chief financial officer Ron Sellwood.
Swick builds rigs, growth options
October 15 - 21, 2007
FULL deployment of its expanded drill rig fleet – including into initial offshore contracts – could see rapidly emerging drilling contractor Swick Mining Services more than treble its revenues in the next two years, cementing a place as one of the Asia Pacific region’s major drilling contractors.
Cloning around
October 15 - 21, 2007
THE Swick drilling name has returned to the Americas more than 40 yeas after Randal Swick’s father left the plains of Nebraska and set up a water-well business in Australia that was the forerunner to the now hugely successful Swick Mining Services (SMS). The intriguing question is this: with the experienced Randal at the levers, how much of the success of SMS will rub off on a new Cougar Metals drilling business being established in Brazil?
Major pieces coming together
September 10 - 16, 2007
ACQUISITIONS continue to flow like drilling fluid in the contracting arena, with Canada’s Major Drilling Group International agreeing to shell out $US22.7 million for Chilean outfit Harris y Cia Ltda in a move which adds 11 drill rigs to Major’s growing Chile fleet.
Layne gains
September 10 - 16, 2007
US-BASED drilling company Layne Christensen has recorded 14 successive quarters of year-on-year earnings improvement, posting net income of $US9.57 million for the three months to July 31 this year. Revenues were up 16% compared with a year ago at $US217.8 million.
Boart core businesses strong
August 27 - September 2, 2007
BOART Longyear claims to have made good progress in reducing employee turnover in one of its “labour hotspots”, and key growth markets, Australia. The company says labour capacity constraints remain a significant challenge after they contributed to reduced margins in the first half of 2007.
Tyres deflate NAEP result
August 20 - 26, 2007
ALBERTA mining and construction contractor North American Construction Group continues to be dogged by higher equipment and operating costs, which contributed to a $C10.3 million net loss for Toronto and New York stock exchange-listed parent North American Energy Partners Inc (NAEP) for the three months to June 30.
EDMS looks to spread wings
August 6 - 12, 2007
NEWLY listed Cobar drilling and mining services company Every Day Mine Services (EDMS) Ltd has secured another significant contract in its New South Wales market stronghold, but is already stepping up efforts to expand the business interstate.
Not-for-sale Boart unit sold
August 6 - 12, 2007
ABOUT four months ago HighGrade asked Boart Longyear’s chief executive Paul Brunner if the company’s Australian capital equipment business was for sale. We were told no. Last week the business was offloaded for $A10.1 million.
Driller hits rich growth pipe
July 23 - 29, 2007
SHAREMARKET darling Jubilee Mines has found a likeness in the parallel world of mining services. Western Australian mining’s emblematic organic growth story has pumped out nickel, outstanding exploration results, and shareholder dividends from its Kathleen Valley mining camp for six years. In the process, its sharemarket capitalisation has gone from less than $A100 million to more than $A2 billion.
Labour slows drilling
July 16 - 22, 2007
BRAKES on leading exploration drilling contractor Boart Longyear’s growth rate are typical of the shackles inhibiting faster global mining industry supply response - and the forces underscoring analysts’ “stronger-for-longer” calls on the mining and mining service sectors.
The new price is right
July 16 - 22, 2007
MINING service businesses in Australia that have aspired to list on the stock exchange or seek private equity backing are increasingly being wooed by public companies desperate to grow on the back of the current boom, as evidenced again by last week’s Brandrill acquisitions.
Shifting sands
July 9 - 15, 2007
THE Canadian oil sands contractor North American Energy Partners doesn’t expect to be hamstrung by equipment and earthmover tyre availability problems as it continues to gear up to meet rapidly expanding needs of the industry.
Dynatec price due soon
July 2 - 8, 2007
FNX Mining is expected to know within weeks the price it will have to pay for the Dynatec Corp contract mining business it is currently in the process of acquiring.
Next chapter already reads well
June 25 - July 1, 2007
MID-TIER Australian mining and civil contractor Macmahon Holdings Ltd could be ready to step up “to the next level”, according to Macquarie Bank, which said last week mining work had expanded Macmahon’s order book such that it had an historically high 72% of next year’s revenues already locked in.
Major dividend
June 18 - 24, 2007
CANADIAN driller Major Drilling Group International Inc expects now to double revenues from its recently acquired African businesses over the next 12 months – a year ahead of schedule – vindicating its latest expansion move at a time of strong growth in other markets.
Boart to focus on global accounts
June 4 - 10, 2007
A MULTI-FOCUSED approach to the drilling business may help Boart Longyear net a bigger share of its key clients’ drilling spend, expanding contracting revenues by as much as $A200 million a year, company management are predicting.
Leighton may have second go underground
May 28 - June 3, 2007
RATIONALISATION of Australia’s underground contract mining sector will continue if Leighton Holdings Ltd pursues the acquisition of specialised contractor Barminco, with the construction and engineering group confirmed last week as a bidder for privately-owned Barminco.
New view for Barminco boss
May 21 - 27, 2007
THE EXTENDED mining investment boom is separating long-time mining service company principals into two camps: those who will ride out the cycle, and those who exit at what could well be the peak point in the cycle. Barminco founder and chief Peter Bartlett has had enough.
In the driver's seat
May 21 - 27, 2007
AUSTRALIAN drilling services firms Ausdrill and Brandrill would appear to head a long list of potential acquisitions for newly listed Boart Longyear, based on their high-level exposure to the production side of the drilling business, and to iron ore and coal.
No Downer news is good news
May 14 - 20, 2007
NO NEWS is, well … good news, really. That’s the take on an investment briefing Downer EDI Ltd gave last week to analysts. After the disappointment of recent major contract writedowns and lingering scepticism about repeats, Goldman Sachs JBWere found the lack of any news on full-year earnings guidance was only “slightly disappointing”.
Contract mining king
May 14 - 20, 2007
FOR YEARS analysts and watchers of Leighton Holdings have wondered why the group has two large contract mining divisions competing against each other in the market. Now, with John Holland’s purchase of Queensland-based CE Marshall and Sons Earthmoving, there are three competing legs. “We are now the world’s largest contract miner,” said Leighton chief Wal King this week.
Swick drills deeper
May 7 - 13, 2007
SPURRED BY a significant new contract with Newmont Mining Corp and stronger than expected investor support for a planned share placement, Australian drilling contractor Swick Mining Services Ltd (SWK) will raise $A20 million in two tranches to more than double its drill fleet by the end of 2008.
FNX takes contracting option
May 7 - 13, 2007
THE land of the maple leaf may lack a burgeoning, locally owned nickel sector these days but on the flipside, none of the Australian nickel miners can claim to own a significant mine contracting business. Canada’s FNX Mining Co does, and it’s a situation it believes will give it a competitive advantage over the expensive merger and acquisition route.
Layne has rhythm
April 9 - 15, 2007
SOARING global mineral exploration activity and the growing search for water underpinned a steep rise in US-based driller Layne Christensen Company’s revenues in the year to January 31, 2007, coupled with a 78.8% increase in net profit to $US26.25 million.
Tonnes of potential
March 26 - April 1, 2007
RIO TINTO and BHP Billiton iron ore executives may have gone home at the end of last week feeling at least a little anxious about the latter’s confirmation it will spend a further $US1.85 billion expanding iron ore production in Western Australia’s Pilbara region. Mineral Resources Ltd (MIN) managing director Peter Wade, on the other hand, was unequivocally upbeat.
In the swim
March 19 - 25, 2007
THEY are a whale and a minnow, but Boart Longyear and Swick Mining Services Ltd are a symbiotic pairing more comparable to the shark and remora. One wonders what will happen when the smaller fish gets too fat.
RUC moves into starter's gate
February 15 - 21, 2007
SOUTH African construction services group Murray & Roberts is close to launching its African and Canadian underground contract mining business model in Australia despite the fierce competition for contracts in the industry.
Contractor hits paydirt
January 25 - 31, 2007
AN AUSTRALIAN underground contract mining group marking its 20th anniversary this year is ahead of the expansion rate targeted in a new five-year growth plan formulated in 2006 and could be on a course to become the world’s first $A1 billion-a-year underground contractor by 2010.
Swick rise
December 7 - 13, 2006
INNOVATION has in the past seldom beaten a low bid in the contract drilling game. However, an Australian drilling contractor is rewriting some long-standing rules of the contest. If they don’t follow suit, competitors may find themselves facing a much more formidable opponent this time next year.