The company said, “Recent market announcements and media commentary concerning capital equipment companies servicing the industrial and resource industries have generally created negative sentiment towards this sector. In light of this and to dispel any associated uncertainty, Boom Logistics is providing a market update prior to the release of its FY09 half year results.
“Management accounts for the first 6 months of FY09 demonstrate an above budget outcome and an operating result ahead of the first six months of FY08. The after tax operating result is in the region of $13.7 million compared to the restated FY08 half year result of $13.2 million..” The accounts are currently being reviewed by KPMG.
After the announcement, the company’s shares reached a peak of AUD0.65, from AUD0.47, before settling around AUD0.58.
The company said it has completed a AUD175m three year revolving credit facility, and arranged a AUD32m working capital and transaction banking facility. Managers continue to see strong operating cash flow, which has helped cut the company’s net debt to equity ratio from 92% at the end of June 2008 to 86% at the end of the year. At the same time, Boom says, it was able to invest AUD20.4m in the business.
Over the same six months, making up the first half of its 2008/2009 fiscal year, the company says it has seen strong improvement in its ‘wet hire’ [hire with operator] utilisation rates. It says it has strengthened its management team.
Crane sales through the James Equipment division of the business have been lower than budgeted, and the company says that it recognises that the current economic climate makes forecasting the full year outcome a challenge. However, it says it expects to meet analysts forecasts or an operating result of between AUD22m and AUD29m, up from AUD18.6m in 2007/2008.
