AusRAIL, Market Sectors

Mineral sands project sees fall in Downer EDI results

<p>Engineering group and rolling-stock builder Downer EDI has made a $163m contract write-down to its 2005&#4706 results after problems with its involvement in the Douglas Mineral Sands project in Victoria.</p> <p>The adjustment leaves Downer with an underlying profit of $138m and an estimated loss after tax of $25m.</p> <p>It comes just six months after Downer reported an expected 20% increase on the $104m profit recorded in 2004&#4705.</p> <p>A company statement said the underlying performance of the company had been strong, but cited extra costs associated with delayed work at the $270m mineral sands project, owned by Iluka.</p> <p>The mine could extract about 550,000 tonnes of mineral concentrate each year. </p> <p>Downer has ongoing rail contracts in Victoria which includes maintenance of 800 km of tracked owned by the Australian Rail Track Corporation (ARTC).</p> <p>Downer is also more than halfway through a five-year contract to maintain 4,700 km of standard and broad gauge track on behalf of Freight Australia.</p> <p>The company was criticised for problems associated with the roll-out of its Millennium trains for the New South Wales passenger train network.</p> <br />