Bradken Limited (BKN) reported a post-tax profit of $25.7 million for the six months to 31 December 2009, a 26% decrease over the previous corresponding period ("pcp"). The company said sales revenue across some of its divisions, including Engineered Products Division was significantly impacted by the global recession and the strength of the Aussie dollar.
 
Looking ahead the rail engineering firm said it expected business to continue to build, particularly orders from Australian businesses, although overseas businesses could continue to lag.

“The Rail business will be particularly strong in FY10 with orders already in place to make forecast sales levels at margins above those of FY09,” the company said in a statement.

The firm reiterated its guidance of a slight decrease in EDITDA in FY10 over the pcp.

Turning to the previous six months EBITDA of $70.7 million was 22% lower than the pcp, although ahead of guidance.

Sales revenue was $463 million, down 25%, while earnings per share was down to 19.8c, a slump of 30%.

In response to the downturn the management implemented a cost-cutting strategy and benefited from previous capital expenditure.

”This combined with reduced overhead spend allowed the EBITDA to sales ratio to improve to 15.3% from 14.7% in HY09,” the company said.

“A notable feature of the half year’s result is the strong cash performance which has allowed us to significantly reduce debt and provide balance sheet flexibility going forward.”

The rail division continued to underpin the strength for the company with sales jumping 21% from the pcp to a total delivery of 842 wagons.

The rail division could attribute the growth to demand from the Chinese Xuzhou facility which came online in the half.

On the downside, the Power & Cement Division saw revenue slump 33%, while the Engineered Products Division saw sales slump 50% to just under $100 million.

At the close Monday, Bradken shares were trading at $5.85.