Boart Longyear’s chief executive Richard O’Brien will step down from the helm of the drilling services company.
The news came as Boart reported a blowout in its net losses to $US152.3 million for the half year to June 30, from a $US142.8 million loss a year earlier.
Chairman Marcus Randolph will take on the role of executive chairman, temporarily, while a search for a new chief executive begins.
Mr O’Brien said he will step down at a date yet to be determined and will continue to provide day-to-day leadership and oversight of the company until he leaves.
Mr O’Brien said that until his departure, he and Mr Randolph will work closely together to accelerate the company’s improvement initiatives.
“My departure does not signal a significant change in the company’s priorities,” Mr O’Brien said on Monday.
He said that during 2013 and 2014, the company had worked hard to improve its cost structure and increase its balance sheet flexibility.
The company had cut about $US1.1 billion from spending since 2012 as it responded to changing market conditions, and recapitalised.
Mr O’Brien said the company’s efforts to cut costs and improve productivity had the board’s support.
Shares in Boart Longyear were 0.8 cents lower at 8.2 cents.
Boart Longyear said the first half of calendar 2015 continued to be a difficult period for the drilling industry and for the company because of stagnant prices for metals and other commodities, which reduced demand for drilling services.
First half revenue fell eight per cent as a result of lower prices for drilling services and unfavourable currency movements due to the stronger US dollar.
If the currency movements had not occurred, revenue would have fallen only one per cent.
“Our results, while disappointing overall, do reflect the general decline in worldwide exploration spending by the mining companies that we have experienced over the last several years,” Mr O’Brien said.
Markets are generally flat, with overall rig levels still near historical lows.
Recent volatility in commodity prices in global markets continues to inject caution into exploration and development decisions by mining companies.
Mr O’Brien said industry analysts were now forecasting that exploration spending by mining companies in 2015 would be down around 10 per cent on 2014.
Cost management will remain a priority for 2015 and for the years to come.
MINING DOWNTURN STILL HURTS BOART LONGYEAR
* First-half net loss of $US152.3m, up 6.7pct
* Revenue of $US388m, down 8.1 per cent.
* No dividend, unchanged