Shares in global explosive manufacturer Orica Ltd (ASX:ORI) have gained 1% on Friday after the company held its annual general meeting (AGM).

Here’s what shareholders heard at the AGM:

  • Financial year (FY) 2015 net profit after tax from continuing operations and before individually significant items was $417 million, down from $564 million in FY 2014
  • The dividend in FY 2015 remained unchanged at 56 cents per share
  • The transformation program which cost $81 million to implement, delivered $175 million in ongoing benefits
  • The newly installed chairman, Mr Malcolm Broomhead, who was previously CEO of Orica from 2001 to 2005, didn’t beat-around-the-bush in stating that the recent performance of the mining service provider hadn’t been acceptable. Mr Broomhead went on to explain to shareholders that steps had been taken to rejuvenate the group including the appointment of a new CEO who is undertaking a swift renewal of the business.

The newly installed CEO Mr Alberto Calderon gave shareholders the following update regarding current market conditions:

  • Conditions set to remain challenging in the short to medium term
  • Commodity prices expected to stay subdued
  • Expecting to see an improvement in earnings before interest and tax (EBIT) in FY 2016 subject to the forward curve for key commodities holding
  • Mr Calderon reminded shareholders that “in the medium to long term, the upward cycle will begin again, like it has always done. And we will be ready for this.”

The above quote by Orica’s CEO is a poignant reminder for investors that the current headwinds facing the entire mining and mining services industry are likely to turn into a tailwind at some point in the future.

Rather than dismissing stocks such as Orica, BHP Billiton Limited (ASX: BHP) and Woodside Petroleum Limited (ASX: WPL), enterprising investors will currently be analysing and watching these out-of-favour cyclical businesses with keen interest.

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Motley Fool contributor Tim McArthur has no position in any stocks mentioned. Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.