Shares in Kerry Stokes’ media and mining services company Seven have falling more than 5% on a warning that earnings are likely to be down in 2015 by 10% to 15%.
For the year to the end of June, Seven reported a 37% fall in underlying net profit after tax of $253 million.
At the company’s annual general meeting today, chief financial officer Richard Richards said there would be a more marked reduction in the first half.
Trading conditions in industrial and mining services are tough, particularly in new equipment sales, he said.
Seven’s businesses include WesTrac, Seven West Media, Coates Hire and Nexus Energy.
The group’s industrial services business had been impacted by falling commodity prices including iron ore, gold and coal.
Many customers are deferring maintenance and enforcing mine shutdowns over the Christmas holiday period.
Seven plans to reduce contractors, cut working hours and jobs losses which could be in the hundreds.
“WesTrac Australia is taking immediate action now and in the coming months to continue to implement significant cost reductions and modification of work processes,” Mr Richards said.
Seven’s announcement follows Orica today saying it will cut 700 jobs due to the shrinking resources industry business.
Seven’s shares are down more than 5% to $6.12.