Investors have responded warmly to the full-year earnings results of embattled transport and logistics provider, McAleese Ltd (ASX: MCS), bidding the share price 21.2% higher to 8 cents.
However, the results were by no means pretty, and reflect why the shares are down 86% over the last 12 months. The company posted a net loss of $90.9 million for the 12-month period, which compares to the $63.3 million loss recorded for the 2014 financial year – a decline of 44% – while revenues were down 16.5% to $639.9 million.
Group earnings before interest, tax, depreciation and amortisation (EBITDA) were also below previous guidance of $70 million at just $61.7 million. This can be attributed to the commodities downturn which saw iron ore hit its lowest price in at least six years which resulted in the temporary collapse of Atlas Iron Limited (ASX: AGO), one of McAleese's major haulage customers (and debtors).
Although the market's response may seem encouraging, investors need to remain wary of the massive headwinds facing the company. With iron ore prices tipped to fall even further over the coming months, and maybe even years, long-term 'Foolish' investors would be wise to give this one a miss.
Besides, thanks to the market's recent crash, ASX stocks haven't looked this appealing in years and there are plenty of other great alternatives to choose from…
