Orica downgrades profit, highlights tough conditions

Orica has written down its asset values by up to $1.65 billion, and the explosives maker has signalled that further cuts may be necessary due to tough conditions.

AAP reports that an already revised down profit expectation of $490 million, to be announced in November, would be about 10 to 15 per cent overestimate.

It said that an oversupply of ammonium nitrate, and investment in the mining sector was weak.

It cut production last month at its Yarwun plant in Queensland, shedding 29 of 220 jobs, and CEO Alberto Calderon said further measures would be considered.  

"Additionally, we are assessing a range of strategic options for how we manage our Bontang ammonium nitrate manufacturing facility in Indonesia for the medium and longer term," The AFR reports him as saying.

"While there are several options, each implies a lower asset valuation."

 

Image: http://www.orica.com/

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