Arrium backs growth in grinding media demand

Arrium
has said there is potential for growth in the company’s grinding media during
an investor’s day yesterday.

Fairfax
reports that Arrium’s balance sheet is stretched despite a $754 million equity
raising, with CEO Andrew Roberts saying there was a need for the company to
continue paying down its debt.

“[But] this
business [grinding media] is a very good business,” Fairfax reports him as saying.

“We have strong market
positions with very good customer relationships. Investors need to look at the
value of the three different [business] segments.”

The company sees
potential in North and South American markets for grinding media, where copper
and gold volumes milled are predicted to increase by 9 per cent annually to
2018/19.

Roberts also left open
the possibility of scaling back or ceasing Arrium’s Southern Iron mining
operation if iron ore prices remain depressed.

Grinding media is the
key part of the company’s mining consumables division, which also includes rail
wheels and ropes.

Arrium announced a profit of $296 million and increased sales in mining in August, following 120 job cuts in May and June.

Image: Arrium