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Industrea Limited (ASX:IDL) Industrea finishes FY2011 strongly

Industrea finishes FY 2011 strongly announcing $22M in China diesel equipment contracts 
-  5 new China contracts for Industrea Mining Equipment roof support carriers
totalling $22M since start of 2011 Chinese New Year

- strong demand continuing for Industrea products from Chinese market buoyed by 20% growth in mining products segment

-  Australian demand at record levels

- Industrea’s domestic production scaled up on back of strong order book carried over into FY 2012

- China manufacturing facility on track to deliver initial products in H1, 2012
 Global mining products and services provider Industrea (IDL) today announced the signing of five new contracts in China since March 2011 for 15 IME longwall roof support carriers (LWC) worth $22M from its Industrea Mining Equipment (IME) division.
The latest of the five new contracts signed was for $10.2M with China’s second largest coal miner, China Energy Coal, for seven 50 tonne LWC to be deployed at the company’s Pingshuo mine.
Industrea also announced an additional four contracts had been signed since March 2011 to supply another eight 50 tonne LWC to Datong ($2.7M), Baoji Qinyuan ($1.5M), Shenhua Ningmei ($6.3M) and Yulin ($1.4M).
Industrea Managing Director and CEO, Robin Levison, said the new contracts announced were in line with the company’s forecast made in the half year results release that the Chinese New Year would usher in new capital budgets for the group’s Chinese customers and increased orders for IME equipment.
Mr Levison said Industrea’s business in China continued to gain significant traction, driven by China’s status as the world’s largest producer and consumer of coal, upon which it relies for around 70% of its rapidly expanding energy needs.
“The growth plan for our market-leading, underground IME diesel products is now strategically interlinked with the Chinese government’s ambitious five-year growth plan for its coal industry.
“With more than 95% of China’s coal reserves underground the country’s coal mining sector is increasingly harnessing specialised equipment and technology to consolidate operations into larger and more highly mechanised mines, along with a concerted focus on safety improvements.
“Industrea’s established position and reputation in China will see us as a major beneficiary of the strong growth in the country’s mining products market, which is forecast to exceed 20% per annum over coming years and reach 150 billion RMB by 2015,” he said.
Mr Levison said that the new contracts coupled with an extremely robust level of domestic orders ensured IME’s Hunter Valley production facility had entered the new financial year with a strong forward order book in place, with operations benefiting from economies of production scale.
“With new capital budgets now in place post the Chinese New Year with most of our customers, we are confident of securing further contracts for IME diesel equipment in the first half of FY 2012,” he said.
Mr Levison said that the facility established in China to manufacture a IME flameproof and explosion proof personnel and materials vehicle exclusively for the domestic underground coal mining market was now well progressed, with the company on track to complete production of initial products to exhibit at the China Coal Show in October.
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