Queensland based project and maintenance services company Goodline has entered the list of Australia’s top 1000 companies.
Goodline originated in Weipa and is a supplier to Rio Tinto in its Amrum bauxite development on western Cape York.
The IBISWorld 2016 list of Australia’s top companies show the business accounted for a total revenue of $365.7m.
However the report shows not all is so rosy in mining and exploration. The sentiment was generally down last year.
Mineral and Petroleum Exploration
Trends in global commodity prices drive exploration for mineral and petroleum resources. Exploration activities are funded through the capital expenditure budgets of large mining companies or capital raised on the sharemarket for smaller miners. As global commodity prices plummeted over the past few years, profitability has fallen for major miners, which has reduced capital expenditure and exploration budgets. The incentive to explore for new resources has been low, which contributed to a sharp revenue decline in 2015-16. Japan Australia LNG (MIMI) recorded a significant decline in revenue for the year as LNG and oil prices plummeted, with the company falling from 134 to 293 on the list.
Mining Support Services
These firms provide specialised drilling, cementing, water pumping and other extra services for mining firms, generally during the construction phase of a mine or gas well. Due to low commodity prices and weaker mining capital expenditure, demand for these players has plummeted over the two years through 2015-16. These firms mostly rely on trends in capital expenditure and commodity prices, and generally have less scope to innovate or change services to stay afloat. As a result, the Mining Support Services industry is highly volatile. Halliburton recorded a large decline in revenue and fell from 669 to 816 on the list. This was due to weaker demand from mineral explorers as the outlook for commodity prices remained uncertain.
Petroleum Product Wholesaling
The Petroleum Product Wholesaling industry recorded a sharp contraction in sales, stemming from the slump in global crude oil prices. This fed through to lower local wholesale prices and lower pump retail prices for petroleum and diesel. Over the two years through 2015-16, industry revenue slumped by over 20%, while the volume of petroleum product sales grew marginally, reflecting growth in the population and motor vehicle registrations. Chevron Australia, which fell from 184 to 124, was significantly affected as company revenue fell by 30.6%.
The industry has undergone substantial restructuring as the supply chain has adjusted to accommodate a greater focus on importing and distributing refined fuel. Shell’s exit from the industry included the sale of most of its assets to Viva Energy (Vitol). Viva has retained the Shell brand for downstream retailing through Coles Express and rationalised some plants.
Heavy Industry and Other Non-Building Construction
The Heavy Industry and Other Non-Building Construction industry has fluctuated significantly over the past five years. Unprecedented activity coincided with the mining boom. However, the completion of major infrastructure projects caused a sharp correction, which contributed to revenue volatility. The Mining division has transitioned from the development phase to the production phase, causing demand for this industry’s construction activity to sharply decline. Similarly, large corrections have also taken place in non-mining infrastructure markets following the build-up of assets and production capacity through to a peak in 2013-14. This has been highlighted by McConnell Dowell’s fall in the list from 169 to 324, after revenue declined by 44.7%. However, strong activity has continued in the railway and telecommunications markets, associated with the NBN rollout and generational rail programs in Sydney.