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MACA Limited (ASX:MLD) is an integrated services contractor which is specialized in mining, crushing, civil construction, mineral processing equipment, and infrastructure. Today (25 February 2019), the company published its half-year results for FY 2019. For the half-year period, the company has provided revenue of $324 million which is 14% higher than the previous corresponding period (PCP). The company has reported EBITDA of $27.6 million which is 27% lower than PCP. The Net Profit After Tax attributable to Members has declined by 33 percent to $8.1 million as compared to PCP.
As per the companyâs announcement, the first half performance of the company was very disappointing with the previously strong performing mining division experiencing a decline in margins with a tightening labour market and slow delivery of new equipment.
The company has outlaid significant capital with the purchase of both mobile equipment and crushing plants. This investment, combined with a persistent focus on project delivery and the utilization of existing idle crushing assets to support recent contract wins, is expected to lead to improved margins in the second half and beyond.
During the half year period, the companyâs Interquip business segment performed well and has a solid bank of work going into the next calendar year. The company expects its Interquip business to continue to deliver on the solid performance over the last six months. Further, the company also announced that its Civil & Infrastructure businesses are delivering quality projects for clients and continuing to improve operating capability, however, these businesses are not yet meeting the company's financial expectations.
In December 2018, the company signed a Letter of Intent for the Open Pit Mining Services Contract and for a Mill refurbishment Contract at the Yandal Gold project with Echo Resources. As part of this transaction, the company has separately agreed to subscribe for $1.5 Million worth of Echo scrip as part of a broader placement.
The Board has declared an interim dividend of 2.0 cents per share, fully franked which will be payable on 21 March 2019 to eligible shareholders who are recorded on the Company's register as at the record date of 7 March 2019.
As at 31 December 2018, the company had operating cash flow of $18.8 million. The operating cash flow was impacted by the timing of payments at the end of the half year period with a significant decrease in working capital expected in the next half. The Capital expenditure for the half-year period was $79.9 million relating to plant and equipment.
With recent crushing wins in the Pilbara, and two mining contracts (under Letters of Intent), the business currently has $2.2 billion Work in Hand. The company is expecting its revenue for the full year to be around $640 million.
Meanwhile, in the last six months, the share price of the company decreased by 21.83% as on 22 February 2019. MLDâs shares traded at $0.980 (down 0.508% intraday, AEST 1:36 PM) with a market capitalization of circa $263.99 million as on 25 February 2019.
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