One of the best-performing shares on the ASX this year has been Bradken Limited (ASX: BKN). Thanks to a 60% gain in its share price in the last two days, it has now climbed an astonishing 250% in 2016.

The big gains this week relate to an announcement from the heavy engineering and mining services company advising the market of its plans to restructure its business model.

Bradken expects the model led by new CEO Paul Zuckerman will better deliver its capabilities to its customers, set it up for growth, and reduce overhead costs. One of the key changes will be the reduction in business units from five to just three.

Mobile Plant will deliver advanced engineered products to mining, mobile plant, rail, and industrial customers. Mining Fixed Plant will bring a full range of the company’s advanced engineering capabilities to its mining customers’ processing plants. Finally, North America-based Engineered Products will focus on and deliver highly engineered and complex parts to its energy, defence, and industrial customers.

The company believes the new structure brings management closer to customers in its core markets, as well creating opportunities to extract material gains from procurement, operations, and supply chain improvements.

Its CEO Paul Zuckerman said, “The new structure will enable us to be more agile, more innovative and more competitive in responding to customer needs, all crucial for success in a competitive and globalised world.”

I believe these changes are extremely positive and of course much needed. Operating margins have been deteriorating at a rapid clip for the last six years, putting significant pressure on the bottom line. With the worst potentially now behind the company, I can understand why investors have been buying up all the shares they can get hold of.

The company also used the announcement to confirm that its earnings before interest, tax, depreciation, and amortisation (EBITDA) are expected to come in at around $108 million for the full year. Although this is a decline from a year previous, it is an improvement on the company’s first half performance and in-line with previous guidance.

In addition to this, the company has managed to reduce its debt throughout the year. Net debt now stands at $350 million, down approximately $50 million from this time last year.

With its shares changing hands at around 6x EV/EBITDA based on its guidance, I wouldn’t necessarily call its shares cheap now. In fact, they are trading at a premium to industry peers Monadelphous Group Limited (ASX: MND), Decmil Group Limited (ASX: DCG), and RCR Tomlinson Limited (ASX: RCR).

But one thing it does have in its favour is its turnaround potential. If this restructuring does arrest its falling EBITDA, then I have little doubt its share price will keep on climbing. But until I see proof of a turnaround I think sitting on the sidelines is the best thing investors can do at this stage.

Finally, instead of investing in Bradken today I would highly recommend taking a close look at these three fantastic blue chip shares. Each could produce share price gains in the months ahead in my opinion. They also pay a growing fully franked dividend as a bonus too.

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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. 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.