Boart Longyear teeters on the brink of collapse

By Simon Frazer

“Without such a transaction, in order to continue as a going concern, the company would need to either experience a significant and rapid improvement in market conditions and the financial performance of the company or secure a future amendment to the terms of the credit agreement”.

Mining services company Boart Longyear has posted another half-year loss, while confirming its future hangs in the balance.

“The ability of the company to continue as a going concern is likely to depend on the company successfully concluding its strategic review of recapitalisation options with completion of a recapitalisation transaction no later than 30 June 2015,” the statement said.

“Our view could change if commodity prices for mined products fall materially from existing levels, mining companies are not successful in pushing forward planned mine expansion and development activities, or mining companies otherwise significantly cut exploration spending from current levels that are already below recent historical levels,” he said.

Photo: Boart Longyear is the world’s biggest mining drilling services company.

Boart’s chief executive Richard O’Brien says the firm feels it is at or approaching the bottom of the market as the end of the mining boom bites, but has added an important caveat.

A statement accompanying the results from the company, which is based in Salt Lake City in the United States but listed on the ASX, acknowledged uncertainty about whether the company has a future.

Boart says, as of earlier this month, 380 of its drill rigs were in operation, representing just 40 per cent of the company’s total.

Read more here: ABC

    

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