Market Conditions
Tough Six Months but Positive Outlook
- Coal production continues to increase in the Hunter Valley, exports through the Port of Newcastle up by 9.6% in FY13 on previous year;
- Long term view on coal price & A$ provides positive market settings;
- Capital expenditure for “yellow iron” is dramatically down over the previous 5 years;
- Shift in focus from capex to opex, but cash preservation by customers is paramount;
- Maintenance backlog will translate into R&M “up tick”, supported by customer forecasts;
- Strong order book with SZG continuing to win new contracts and re-sign existing contracts;
- OEM and third party competitors have dramatically reduced capability in the Hunter Valley.
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