Orica has flagged a $191 million write-down of defective equipment at its Burrup operation and confirmed the troubled explosives plant will fall behind its production target, but its earnings outlook remains unchanged for the year.
Orica is one of the world’s biggest explosives makers. Burrup, which is jointly owned by Orica and Yara International, was originally declared commercially operational in 2017, but it has suffered numerous equipment problems since then.
Orica chief executive Alberto Calerdon told investors in December that the current remediation work would be finished in the first half of the 2020 financial year.
Orica said the plant’s utilisation would be lower than the 20 per cent forecast at the December shareholder meeting, but said the group’s overall outlook remains unchanged.