Industrea Ltd

Managed to get some Industrea's shares today at $0.14 per share. The share price dropped as much as 30% from $0.195 today on the announcement that IDL lowers its NPAT guidance.  I intended to treat this purchase as a short time trade. Stop loss at 25% lower than purchase price.

From the news today:

Industrea lowers NPAT guidance

Marcus Berghouse

   

16/01/2009 12:00:00 AM.  

Industrea Limited (IDL) said the termination of its contract with Xstrata, combined with unseasonably high rainfall, had lowered expectations for FY09 revenue and NPAT. The company said NPAT would be between $42 million and $47 million, down from the $55 million to $60 million forecast last October.

The company said revenue would drop by 12% to between $290 million and $310 million.

On Wednesday, Industrea requested a trading halt indicating it had received notice from Xstrata plc's Mt Isa Mines that it was placing its Handlebar mine on care and maintenance and as such would be terminating its contract with Industrea for the provisioning of mining services. The company said the termination would be effective from 10 February 2009.

Investors reacted poorly to the news with Industrea's shares coming out of trading halt down around 26% down.

Industrea said its other mining services contracts in the wider Mt Isa region, including those with Xstrata at the Blackstar and Ernest Henry mines, remained operative. The company noted that at Blackstar there were plans to increase production by 38%.

The mining services company said it was in negotiations with various partners to replace the lost contract.

CEO Robin Levison said that aside from the disappointment at losing the Handlebar contract, the other business units of the company continued to  perform in line with forecasts.

"While the termination of the Handlebar Hill contract was disappointing, Industrea remains in a strong financial position," he said.

"Industrea also continues to explore new avenues for growth across its diverse client base and geographical markets with particular emphasis on the Chinese market in order to meet the Chinese Government's long term goal of increasing coal production to satisfy increased energy requirements over the next decade," Mr Levison said.

http://www.livenews.com.au/Articles/2009/01/16/Industrea_lowers_NPAT_guidance