Bradken first half profit leaps 65%

Mining equipment maker Bradken is confident of reaping more strong profits from the resources boom following big purchases and new projects in Australia and overseas.

Bradken on Tuesday reported a net profit of $43.05 million for the half year to December 31, up 65.6 per cent on the same period a year earlier.

It confirmed its net profit guidance for the 2011/12 financial year would remain unchanged, with growth in the range of 35 per cent to 40 per cent.

Chief executive Brian Hodges said the result was in line with expectations and put Bradken in a strong position.

"Bradken's laying a really strong platform for what is a growing market," he said on Tuesday.

"We're positioning ourselves to take advantage of that growth."

IG Markets analyst Stan Shamu said the result was a little disappointing given the record amount of spending in the mining sector and strong performances from Bradken's competitors.

"Analysts had big expectations about these mining services companies following the increase in mining spend," he told AAP.

"As well, [mining manufacturer] Caterpillar had fairly positive results recently which were a good indicator for companies such as Bradken."

Shares in Bradken slumped 22 cents, or 2.73 per cent, to close at $7.83.

The company, which manufactures equipment for the mining, energy and freight rail industries, has seen orders flowing in at historically high levels in the past six months.

Revenue from the mining products division rose 26 per cent on the previous corresponding period, even with a drop in sales of ground-engaging equipment.

To meet an increase in demand for cast steel products, Bradken boosted its foundry capacity by 25 per cent in Australia, Asia and North America.

Part of the capacity boost came through the acquisition of Canadian foundry Norcast, West Australian-based WPS and AOA in NSW.

The $222 million acquisition of Norcast and AOA in July 2011 made Bradken the largest global supplier of cast steel mill liners to mining regions.

A new foundry in Xuzhou, China, will also help Bradken meet the increased global demand for its products.

"With such a strong order book, really at record levels, the focus for the second-half is on the effective utilisation of the new capacity," Mr Hodges said.

"We're looking for a stronger [FY]13 as we go forward."

Shareholders will receive a fully-franked interim dividend of 19.5 cents a share, up one cent on the same period a year earlier.

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