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Layne mineral drilling pipeline evaporates

US-based drilling contractor Layne Christensen Company says margin crimping accompanied a 21% year-on-year decline in its first-quarter mineral exploration revenues to US$23.3 million, with the shrinking business likely to be a further debt-reduction option following last month’s sale of Layne’s geoconstruction drilling arm.

Despite cost-cutting measures, Nasdaq-listed Layne said its cost of sales crept up to 81.1% from 80.7% in FY5 Q1, largely due to “very low activity levels in Africa which produced margin losses”.