Swick provides update on its underground diamond drilling contracts

08-Apr-2019 Intellasia | | 8:29 AM Print This Post

Swick Mining Services Limited (‘Swick’, ASX: SWK), a leading provider of high-quality underground and surface mineral drilling and mineral analysis services, is pleased to provide an update on its recent contract tender outcomes and new contract awards that have delivered a significant increase to its order book.

As a result of the tender outcomes, Swick is pleased to advise that it has secured $210 million in new work, bringing the total order book to $295 million. Given this, and as previously advised, Swick is transitioning some of its underground rigs during 4Q FY19, which involves the Company either reducing rigs or withdrawing from underperforming projects.

The new work includes a contract in the United States for Northern Star Resources that will take the Company’s international drilling rigs in work to 19 from the current 11, representing around 35 per cent of Swick’s deployed underground diamond drilling rigs.

Swick Managing Director, Kent Swick, said the new work provided Swick with a strong platform for FY2020.

“What is important about these redeployments is that they are in line with our strategy of ensuring we are mobilising rigs that are delivering our target margins, whether that be at existing projects or new sites,” Mr Swick said.

“We are delighted that this new work will significantly grow our order book, providing Swick with a strong platform to deliver earnings growth in the 2020 financial year. In particular we are pleased to see the growing success from our international strategy, especially in the USA where the award of this contract will see Swick take a leading position in market share.

“Our focus is to ensure we deliver on this work safely, reliably, and efficiently for our clients.

“Meanwhile, despite being unsuccessful for some work we were tendering for, the new deployments ensure our deployed rig count is roughly maintained whilst ensuring the Company is well positioned to quickly deploy rigs at new projects if they are secured, with a number of active tenders already in place and additional opportunities at brownfield operating mines to be targeted.”

To view the full ASX announcement please click here.

(Source: FTI Consulting, Strategic Communications Perth)


Category: FinanceAsia

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