Business

Job cuts expected at Orica as explosives demand drops

ORICA chief executive Ian Smith has flagged more job cuts at the explosives maker, where he has brought in management consultants to perform cost reviews and confirmed the company may exit its $1.2 billion-a-year industrial chemicals business through a spin-off or sale.

The Melbourne company, which has a plant in Gladstone, had its biggest one-day slump in 10 months on Tuesday after it missed first-half earnings expectations and downgraded full-year earnings guidance because of depressed coal prices and production that resulted in a 2% drop in explosives demand.

The guidance downgrade said Orica expected to meet or exceed its 2013 full-year profit of $592.5 million, down from previous guidance that profit would rise.

Speaking after the earnings release, Mr Smith warned that if coal prices continued to fall, more production would be cut and Orica might report a drop in full-year earnings.

"The second half is contingent on the volumes we get out of coal," Mr Smith told The Australian.

"If coal prices were to come off in the second half we expect that would impact the volumes of coal."

Mr Smith revealed that Orica had cut 1000 jobs in the past year and there were more cuts to come.

The company announced a statutory net profit after tax of $242 million for the half year ended March 31, compared with the previous corresponding period of $263 million.

The result was driven by lower mining services volumes and a reduced profit contribution from chemicals.

Overall sales revenue of $3.36 billion was up 1% on the previous period.

Global explosives volumes were down 2%, largely due to the demand profile of international coal and Latin American metals markets.

In Australia, explosives volumes have grown by 5%, driven by a 40% increase in volumes in the Pilbara offset by relatively flat volumes on the east coast.

Topics:  gladstone business orica sharemarket



How to survive a bushfire in your car

IT SOUNDS like a nightmare, but it can happen.

Eight reasons to join the RFS

SPREAD across 93% of Queensland, the Rural Fire Service has about 36,000 volunteers. And you could be one of them.

What if my insurer gives me grief?

CLAIMING your insurance cover after a natural disaster can go one of two ways. It can be a breeze, or like pulling teeth.

Fisherman caught off Gladstone pay for their actions

CAUGHT: Illegal Vietnamese fishing boat caught off Gladstone with 3 tonnes of sea cucumbers.

ILLEGAL fishermen caught kept under guard. More could be coming

Developer's grand new multi-million dollar estate

NEW ESTATE: This is the only plan revealed by the property developer's new Billabongs Estate in Agnes Water.

DEVELOPER given the go ahead for a massive estate with 149 homes.

'Tough times': Truckload of treats for Gladstone kids

BIKEFUL: Matt and Clyde Luck head off on the Ulysses Christmas toy run.

Numbers down but smiles all around for Ulysses toy run

Local Partners

Hacksaw Ridge wins big in first round of AACTA Awards

Luke Bracey and Andrew Garfield in a scene from the movie Hacksaw Ridge.

THE major awards will be handed out on Wednesday night.

Paris Hilton fumes at clumsy partygoers

A reveller spilt their drink on Paris Hilton's DJ decks

Winnie Harlow isn't a role model

Winnie Harlow insists she isn't a role model.

Felicity Jones proud of Rogue One: A Star Wars Story role

Felicity Jones feels it is "important" for a woman to head Rogue One

Kiwi's plea to Ellen DeGeneres to save bakery after quake

Ellen... we need your magic.

Family had to be helicoptered out after powerful quake

Seacrest: Things are "going better" for Kim and Kanye

Ryan Seacrest says things are "going better now" for Kanye West

Couple's desperate $550K price drop to sell Gladstone home

Brian Headley and Kirstene Staib are selling their Kin Kora mansion for $750,000.

TELL tale sign of Gladstone's property market.

Seven Gladstone homes selling right now leave experts shocked

PROPERTY GURUS pick seven properties that show market has hit bottom

Banks reclaim Gladstone homes as job losses bite

LONG FALL: Property experts Heron Todd say, based on key market indicators, Gladstone is still travelling to the bottom of the market, with property prices set to get cheaper.

Property valuers say Gladstone housing market hasn't hit the bottom

The million dollar property to test Mackay's market

This Victoria St building will go to auction Tuesday and investors will be watching closely to see how much it sells for.

'High profile architect designed CBD asset' goes to auction

Prices jump in trio of mining towns

THE boost in coal prices in the past six months has triggered a house price jump in at least three mining towns in Central Queensland.

Boost in coal prices triggers a market turnaround

Ready to SELL your property?

Post Your Ad Here!