Master Drilling Group today released its Annual Results for the year ended 31 December 2017. Revenue increased 2.8% to $121.4 million and operating profit decreased marginally to $24.8 million. This was a positive result given that one of the Group’s machine categories, the XX-large machines category, was utilised only 40%. Cost of sales increased in line with the increase in revenue bringing about a flat gross profit percentage in US$ terms.
Commenting on the results, Danie Pretorius, CEO of Master Drilling, said “Despite 2017 having been a challenging year with various political changes across the world and a tough local macroeconomic environment, we delivered stable operational results in 2017 with the continued focus on working capital bearing fruit in the form of satisfactory cash generation.
“The uptick in the global economy and commodity cycle is expected to have a positive impact on our business going forward. Our pipeline is strong and we are excited about our entry into India and Australia, further diversifying our geographical exposure. The recent acquisition of Bergteamet Raiseboring Europe provides a launchpad for further expansion in Europe. There are many synergies between the two companies and this business complements our focus on providing innovative tailored technology solutions to our clients.
“New management strategies and actions implemented in some challenging regions have turned most of our underperforming businesses around. As a result, we expect an improvement in most global regions where we do business during the next reporting period. We will continue to balance investments in technology and people that support growth with the need to drive efficiencies and productivity ratios across the group. This approach coupled with our diversification strategy across regions, commodities, currencies and industries will see our revenue and margins stabilise further,” added Pretorius
Whilst escalating cost pressures in the mining sector continue to be a challenge, Master Drilling remains well positioned to expand its service and product offering strategically into other industries as well as additional geographies because of continuous technological innovation.
“We are particularly proud of the launch of our Mobile Tunnel Borer in February 2018. This disruptive technology allows continuous mining and requires no blasting, significantly enhancing mining efficiencies. Because it is as advantageous at the capital stage of mining projects, with quicker deployment and access to the ore body, as it is at the production stage through substantial productivity increase when opening reserves or increasing a mine’s underground primary and secondary infrastructure, we believe this will open the doors to more opportunities in future.” said Pretorius.
