Revenues at Irish engineering group Mincon decline by 9 per cent in the third quarter versus the preceding three months due to an overall decline in the mining and exploration sectors.

Mincon, which specialises in the design, manufacture, sale and servicing of rock drilling tools and associated products, said recent acquisitions, which include Rotacan in Canada, ABC Products on the east coast of Australia, and Omina Supoles in Namibiba, are expected to start contributing positively to the group’s net profit from the first quarter of 2015.

Revenue from Mincon’s core manufactured products declined versus the previous quarter while newly established trading entities in Peru and Ghana also trading more slwoly than expected.

Sales of third party product for the third quarter were behind due to the lack of sale of high value rigs in Southern Africa, as localisation of the rigs continues. Mincon said the sale of rigs remains a key part of its strategy for the region and that it now had adequate inventory.

The gross margin and net margin year to date for 2014 have remained steady at 47 per cent and 19 per cent respectively, excluding the impact of acquisitions.

The group has a strong balance sheet with net cash of €41.2 million.

Mincon, which is listed on the Dublin market, said it is engaged in valuation discussions with a number of potential acquisition targets.

"Market conditions for the mining sector of our business (approximately 50 per cent of overall sales) remain challenging, especially in the exploration sector given the decline in metal commodity prices throughout the course of 2014," said the group's chief executive Keith Barry.

“This cyclical weakness, combined with the significant devaluation of certain key currencies in which we trade, has impacted upon the group’s year to date result for 2014. The group remains committed to its stated strategy of becoming the third major player in the rock drilling consumables industry,” he added.