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Mining tax drama hits Runge result

UNCERTAINTY caused by the super profits tax has hurt mining technology services company Runge, wh...

Blair Price
Mining tax drama hits Runge result

Total revenue fell 5% year-on-year to $79 million but software maintenance revenue increased 10% to $8.01 million.

Runge said the operating environment was difficult due to the global financial crisis and the uncertainty caused by the resources super-profits tax.

“This led to a weakening in demand for major feasibility studies and large software sales, particularly in Australia,” the company said.

Despite the negative impacts to its domestic operations, Runge managing director Tony Kinnane said the company had a strong offshore result.

“Unfortunately we were slow to adapt,” he said.

“While we continued to invest in our people, we suffered through lower utilisation.

“This was addressed in the second half by greater mobility of staff, some attrition and focusing on demand outside of Australia.”

Runge’s board elected to not pay a final dividend for the 2009-10 financial year.

The company derives a great deal of its revenue from technical and business consulting for the coal and iron ore industries, and expects continuing uncertainty in the Australian market.

“We have continued to invest in our people and our internal business systems have been substantially upgraded over the last 18 months,” Kinnane said.

“This will give us greater visibility over our global operations. New offices have been opened in Mongolia and Russia in line with our geographic growth strategy.”

Runge’s result follows a recent 16% year-on-year fall in net profit for Coffey International.

Coffey shed jobs mainly across its “Asia-Pacific region” after June, once it concluded the economic and political environment would continue to create an uncertain market.

Runge shares are down 2c to 47.5c this morning.

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