Polish mining gear maker Kopex going abroad to defy mining slump

Primetech SA

30/06/2015 13:10

By Anna Koper and Jakub Iglewski 
    WARSAW, June 30 (Reuters) - Polish mining machinery maker 
Kopex  KPX.WA  is looking for contracts abroad, bracing for a 
fall in its 2015 net profit due to a crisis in the local coal 
sector, its chief executive said. 
    Poland's coal mining giants, which have been Kopex's main 
clients for years, have minimised their investment spending as 
they struggle to avoid insolvency amid falling coal prices and 
trade union protests in overstaffed mines. 
    Kopex is seen posting a 40-percent fall in its 2015 net 
profit to 60 million zlotys ($16 million), according to the 
average of three latest analyst forecasts in Thomson Reuters 
Eikon. 
    "The situation is tragic. The (Polish) coal mines are losing 
their breath," Kopex CEO Jozef Wolski said in an interview with 
Reuters cleared for publication on Tuesday. 
    "(But) I think that analysts underestimate our cost cutting 
potential. They (latest forecasts) paint a pessimistic scenario 
and we could surprise analysts positively." 
    The company's shares listed in Warsaw have shed almost a 
third of its value this year, reflecting a sector slump.  
    Kopex's main competitor Famur  FMF.WA , and coal miners JSW 
 JSW.WA  and Bogdanka  LWBP.WA  all lost around 30-40 percent in 
the year-to-date. 
    Kopex's 2015 goal is to keep revenue at the same level as in 
2014 by selling more equipment to low-cost miners in countries 
like Russia or China, which are in a better condition than their 
Polish peers and offer better margins. 
    "The share of exports in our revenues will change 
significantly this year (versus 43 percent in 2014). I suppose 
the majority of our revenues will come from abroad," Wolski 
said. "(Meanwhile) margins in Poland have fallen and will fall 
further." 
    Kopex also aims to diversify its production by building 
machines for energy utilities and elements of railway 
infrastructure. The energy sector should be "visible in 
revenues" this year, and the latter in 2016, Wolski said. 
    The company will publish its current order book value 
alongside its quarterly results in August 
    Kopex further aims to keep its debt at bay with net debt to 
core profit EBITDA ratio at 1.4-1.5, Wolski he added. 
($1 = 3.7493 zlotys) 
 
 (Editing by Mark Heinrich) 
 ((jakub.iglewski@thomsonreuters.com; +48 22 653 9721; Reuters 
Messaging:  jakub.iglewski.reuters.com@reuters.net)) 
 
Keywords: POLAND MINING/KOPEX