Ann: Market Update , page-9

In general:
Weakening demand, high debt, large staff base, don't mix well.
But I doubt this is the long term trend. Well I bet John has more to say, he just came back from the state so we can expect him being able to explain more on Friday.

I am aware that the nature of COF's business won't produce stable earnings as its earnings are cyclical and project based, and given more n more projects got delayed in Australia I think 2H is 20%~50% worse than 1H~ having said that lets not assume the trend will always be like this. My view is that so long the mining, infrastructure and oil&gas industries stand, COF won't go out of business, yes the NPAT will be ugly in 2H13 but if the management respond to weakening demand timely and cut costs, the SP will survive. Personally I would value the co based on Operating cash flow rather than manipulable NPAT. (One thing I do notice is COF's past track record in acquisition which until now still records some 100m goodwill in its book).