Mincon posts earnings surge despite ‘challenging’ global conditions

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Irish engineering group Mincon saw profits and sales rise in the first half despite ongoing cost increases in raw materials, energy and transport.

The Company specializes in the design, manufacture, sale and service of rock drilling tools and related products.

The company’s operating profit for the six months ended June 30 rose to Euro 8.8 million, an increase of 18 percent over the same period last year. EBITDA increased by 15% to €12.7 million.

Sales increased by 27% to €85.1 million in the first half of the year.

Mincon has seen growth in all three of its major verticals, including mining, construction, and water wells/geothermal. Investments over the past year also contributed to higher revenues due to increased production at the factories.

The US market also played a role in Mincon’s growth in the first half following last year’s acquisitions of Attakroc and Spartan Drilling Tools, while growth in construction sales was fueled by the supply of products for a major order in the US.

However, CEO Joseph Purcell said the growth has been accompanied by “some pressure on our margins.” Gross margin was lower compared to the previous period, according to the group.

This was due to cost increases on “many fronts” including raw materials, energy and transport, with the company using air freight to clear backlogs.

“Continuous vigilance is required to keep up with the pace of cost-inflationary pressures that we are seeing,” he said.

“Ocean freight conditions remain challenging and with no improvement in sight, we will continue our current policy of maintaining high inventories of finished goods,” said Mr. Purcell.

In response to the ongoing challenges, Mincon has implemented price increases that are now beginning to take effect.

However, some supply chain challenges for the group have eased.

“On the positive side, constraints on raw material availability have eased recently, which has allowed us to start destocking raw materials due to better supply conditions,” said Mr. Purcell.

https://www.independent.ie/business/irish/mincon-records-rise-in-profits-despite-challenging-global-conditions-41896459.html Mincon posts earnings surge despite ‘challenging’ global conditions

Fry Electronics Team

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