Macmahon divests equipment from Dawson South

Mining services provider Macmahon Holdings will sell a large portion of its remaining mobile equipment fleet at the Dawson South project in Queensland's Bowen Basin region.

The sale is expected to provide Macmahon with net cash inflows of approximately $44 million in the 2023-24 and 2024-25 fiscal years.

“I am pleased that we have been able to sell a significant portion of the Dawson South fleet and advance Macmahon’s Capital Light strategy to improve return on average capital employed (ROACE) performance – our target was recently increased from 15 per cent to 20 per cent “Cents,” said Macmahon Managing Director and Chief Executive Officer Michael Finnegan.

“I would like to thank the Macmahon team who worked closely with our customer to deliver this solution.”

The Dawson South Project is part of Anglo American's Dawson South open-pit metallurgical coal mine.

Macmahon became Anglo American's mining contractor on the Dawson South project in March 2021. This existing contract expires on June 30, 2024.

Both companies are currently negotiating the terms of the new agreement, which is expected to come into effect on or before July 1, 2024. Macmahon expects to retain its approximately 210 employees.

“No new capital expenditure is expected in the new term due to the disposal of a large portion of the Dawson South equipment fleet deployed on the project,” the company said.

Macmahon officially acquired mining services specialist Pit N Portal from independent mining equipment rental company Emeco in February. The deal was first announced in December 2023.

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