Stock of ALS Ltd Earnings driven by commodities business in FY2017
Earnings driven by commodities business in FY2017:Stock of ALS Ltd (ASX: ALQ) moved up by 12.8% on May 24, 2017, following the announcement of better performance for FY2017 and divestment of loss making businesses. The revenue grew by 2.7% year on year (yoy) to $1,272 million, while net profit reported a 4.0% yoy growth at $112.7 million for FY2017, aided by a second half underlying result of $53.1 million (excluding nonlaboratory operations of Oil & Gas) with continuing recovery in mineral resource exploration. The statutory net profit for FY2017 stood at $81.6 million compared with the net loss after tax of $240.7 million recorded in FY2016, while the revenue from operations was $1,366 million, unchanged from the $1,365 million in FY2016. Importantly, the commodities division of ALS (now incorporating the coal services operations) delivered an underlying contribution growth of 28.1% with improved geochemistry sample flow being partially offset by small profit reductions in the coal, metallurgy and inspection businesses. The Industrial Division delivered relatively flat performance while Life Sciences suffered a decline in profitability as a result of issues experienced in North and South America, and higher carrying costs associated with the integration of Alcontrol in the UK.
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