Seven shares fall on gloomy outlook

Seven Group Holdings reported a net profit of $486 million for the 2012/13 financial year. Source: AAP

SEVEN Group Holdings shares have fallen almost 10 per cent as the company foreshadowed a massive drop in full year earnings due to a downturn in the mining sector.

The industrials and media group's prediction of a 30 to 40 per cent fall in 2014 earnings comes after it made a record profit of $486 million for the 2012/13 financial year, almost triple its $177 million result for the previous 12 months.

A strong first half performance from its heavy equipment business WesTrac drove the profit result.

But the group's industrial assets were affected by the slowdown in mining investment in the second half, prompting cost cuts.

Seven Group now anticipates full year 2013/2014 profit results to be closer to the 2010/2011 levels.

Chief executive Don Voelte said the mining sector downturn was affecting industrial services businesses, particularly those in New South Wales tied to the struggling coal industry.

"WesTrac Western Australia is going okay, but we do see pressure on the mining managers to maximise their cash flow," Mr Voelte told analysts on Tuesday.

"NSW is probably even a little bit worse than even we might have thought."

In the first month-and-a-half of 2014, strong iron ore prices were holding up the West Australian WesTrac business, but the early signs for coal were not pleasing.

Mr Voelte said the group would review its capital expenditure and costs to meet the changing market demands for mining and industrial services products.

Given the uncertain outlook for both the mining and media industries, the company expects its 2013/14 net profit to be below that recorded last financial year.

The group's 2013 full year result was boosted by $90 million worth of significant items including a $50 million gain from the sale of the company's stake in Consolidated Media for $491 million.

Seven Group owns a stake in Seven West Media along with industrial companies WesTrac and Coates Hire.

The television business, the separately listed Seven West Media, also performed relatively well in a challenging environment, despite posting a $70 million net loss, the group said.

Seven Group Holdings said it would continue to focus on reducing costs and improving WesTrac's performance in Australian and China during 2013/14.

At 1134 AEST, Seven Group shares were 9.6 per cent lower at $6.96.

Anda sedang membaca artikel tentang

Seven shares fall on gloomy outlook

Dengan url

http://beritasementara.blogspot.com/2013/08/seven-shares-fall-on-gloomy-outlook.html

Anda boleh menyebar luaskannya atau mengcopy paste-nya

Seven shares fall on gloomy outlook

namun jangan lupa untuk meletakkan link

Seven shares fall on gloomy outlook

sebagai sumbernya