STU - Steel & Tube Holdings

[Arbroath]

Caught up this week with a small competitor of STU. They are having record month after record month and see this as lasting for years. He did say that the freight rates and the problems with shipping are not getting any better and for a small company they don’t have the cash like steel and tube does to take advantage and bulk purchase.

It’s an inflation hedge as the costs are passed on. He said that they are increasing there prices with virtually every shipment and customers are accepting as they don’t have much choice. These high prices are here to stay. His biggest issue was having enough staff to keep up and service the demand.

I hope you’re right shareguy that it’s a multi year price trend. It’s 19% of my portfolio so I’m looking forward to tomorrow…hopefully it’ll become 30% over the next 12 months just by the price going to $2.50+

[Sideshow Bob]

Steel & Tube 1H22 Interim Results Announcement - NZX, New Zealand’s Exchange (https://www.nzx.com/announcements/387715)

Steel & Tube Holdings Limited has reported its unaudited interim results for the six months to 31 December 2021, with record half year revenue and earnings driven by strong sector demand, our focus on customer service, operational performance and disciplined supply chain management.

• Revenue of $282.2m, up 25% on prior comparative period (pcp), with strong trading pre and post the Covid-19 lockdown in August and September 2021
• EBITDA of $31.9m, up 87.3% on pcp
• EBIT of $22.6m, up 166% on pcp

• Net profit after tax of $14.3m, up 253% on 1H21

• Interim dividend of 5.5 cents per share (1H21: 1.2cps).

$m / 1H22 / 1H21 / Change
Revenue / 282.2 / 226.3 / ↑
EBITDA / 31.9 / 17.0 / ↑
Normalised EBITDA* / 31.8 / 16.8 / ↑
EBIT / 22.6 / 8.5 / ↑
Normalised EBIT* / 22.5 / 8.3 / ↑
NPAT / 14.3 / 4.1 / ↑
Net Cash / 1.2 / 23.9 / ↓
Total Dividends (cps) / 5.5 / 1.2 / ↑

* 1H22 and 1H21 Normalised EBITDA and Normalised EBIT have been adjusted to exclude non-trading adjustments. Further details are included in appendix to the Investor Presentation.

CEO Mark Malpass commented: “Steel & Tube has traded well during the period, delivering solid volume and sales growth and margin improvements, while continuing to invest into the business, our workforce and growth opportunities. The priority over the last six months has been on maintaining availability of critical products and high levels of service for customers while navigating global steel mill and supply chain constraints, a higher pricing environment and Covid-19 restrictions. I’d like to acknowledge the efforts of our team who continue to deliver day in and day out for our customers and shareholders during these challenging times.

“The strong foundation built over the last few years has resulted in a concentrated focus on our customers, coupled with a structurally lower cost base and improved margin disciplines. Cost savings have now been embedded with cost increases in the first half of the financial year limited to salary and wage inflation and incentive accruals, resulting in operating costs as a percentage of sales continuing to decline. We have been disciplined in our focus on customers and product mix, targeting products and sectors that have allowed us to improve our overall margins.

“Supply dynamics have been tight - steel mill customers continue to be on allocations, lead times have increased both locally and offshore, and there have been significant cost price escalations. Steel & Tube has utilised its cash position to increase stock levels of high demand items and ensure availability for customers. Using data analytics, our experienced team has been able to hold inventory unit turns in line with previous periods (excluding goods in transit). Careful planning and strong partnerships with shipping and freight forwarding suppliers has helped manage long lead times and increased costs.”

Capital expenditure has been reduced to depreciation levels during the Covid-19 period. Increased investment is expected in 2H22 as the company expands and builds into new and existing growth sectors and continues to build out its digital strategy.

Business scorecard measures - safety, customer satisfaction, employee engagement and greenhouse gas emissions - continue to show improvement.
The Board is pleased to declare an unimputed interim dividend of 5.5 cents per share.

Outlook
The strong demand for steel is expected to continue. Commercial building and manufacturing sectors are both expanding, and infrastructure is benefitting from Government investment and spending, while the current residential activity is expected to be maintained in the short term. No significant change in sector headwinds (supply chain, labour, supplier costs) is anticipated in the next six months.

Omicron is expected to escalate over the next few weeks and cause disruption for a number of months. A vaccination mandate has now been implemented and careful planning has been undertaken to minimise the risks to its employees, customers and supply chains. The company is also registered as a critical service as part of the close contact exemption scheme.

The focus for the second half of the financial year remains on continued gross margin dollar improvement, investing in growth areas and leveraging Steel & Tube’s digital platform. The company has a long pipeline of secured contract work and is well positioned to take advantage of identified opportunities in a range of sectors. A sizeable investment has been made in new plate processing equipment to build share in this higher margin sector, along with further investment in steel framed housing processing equipment. We are also pursuing new product growth opportunities.

Steel & Tube has completed a significant turnaround and is focusing on capturing growth opportunities. Subject to the impact of Omicron, Steel & Tube anticipates continued earnings momentum and dividends in the second half, which has eight less trading days (6%) than the first half.

Results Call
The company is hosting an Investor and Analyst Call today at 10am to discuss the half year result. Access details for the call can be viewed here https://www.nzx.com/announcements/386020.

ENDS

[percy]

An excellent result,with a very positive strong out look.
The higher than I expected good divie is another pleasant surprise.Record date 10th March,payment 25th March.
And a thank you to posters for sharing their research and thoughts.I was late to the party buying at $1.30 ,for the long term dividend income part of my portfolio.

[Rawz]

An excellent result,with a very positive strong out look.
The higher than I expected good divie is another pleasant surprise.Record date 10th March,payment 25th March.
And a thank you to posters for sharing their research and thoughts.I was late to the party buying at $1.30 ,for the long term dividend income part of my portfolio.

Share this sentiment. Great result and thanks to the many posters that highlighted the value here- SailorRob and especially Shareguy.

[Shareguy]

First thoughts. Outstanding turnaround as expected.

compare

Measure First half 20. First half 21

eps. 2.5 cps…………………8.7 cps
divi. 1.2 cps. ………………5.5 cps

2 half historically is improved result with a div of 3.29 cents paid 24/9/21

I think my full year forecast of $50m ebit will be exceeded. Is one of the highest dividend returns on the NZX.

[freebee]

Very happy with that result, well done STU.
Nice divvie and very positive outlook.
Great sector to be in right now.
Glad i kept buying all the way up from 80c with a target price of $2
Happy Holder

[winner69]

No imputation credits on divie this time around

[winner69]

Inventory $153m (last June $113m)

That should keep them going for a while and good seeing supply chain issues etc etc

Hope its all good useable stuff and they keep track of it and don't repeat past mistakes

[Arbroath]

Inventory $153m (last June $113m)

That should keep them going for a while and good seeing supply chain issues etc etc

Hope its all good useable stuff and they keep track of it and don't repeat past mistakes

Agreed....but they aren't actually carrying much more stock, maybe 10% as most of the difference is the value of the stock is markedly higher than 6 months ago.

[winner69]

First thoughts. Outstanding turnaround as expected.

compare

Measure First half 20. First half 21

eps. 2.5 cps…………………8.7 cps
divi. 1.2 cps. ………………5.5 cps

2 half historically is improved result with a div of 3.29 cents paid 24/9/21

I think my full year forecast of $50m ebit will be exceeded. Is one of the highest dividend returns on the NZX.

full year ebit $55m on the cards

[Rawz]

full year ebit $55m on the cards

So $37m npat? ish
Current PE 7.22 ISH

Gee this is easy worth over $2.50

[winner69]

whats the depth look like guys

big share price rise today?

[Arbroath]

underwhelming so far 1.61 match

[Entrep]

premarket depth is a meme

[percy]

underwhelming so far 1.61 match

With The Dow down 482.57 points I think we are doing well.
STU up 2 cents,HGH up 3 cents and SPK up 1 cent.

STU now up 5 to $1.66.
The momentum is building...lol

[Arbroath]

it will heat up if they can break the $1.70 level today/tomorrow...would help if the US could go up for a change

[Beagle]

Adding my thanks to those who have covered this one. Like Percy I was late to the party but enjoying it nonetheless.
Great result with a very strong outlook. Happy holder.

[Rawz]

I remember last year MHJ reported a great half year result in August which was above my expectations and the SP sat in the same spot for a like a month!! I couldn't believe it and was buying everyday until i got well above self imposed portfolio allocation size. I started to think wtf have i gone crazy??? What have I missed. These numbers are amazing!! Eventually it increased from $0.85 to $1.50 in the following 5 months..

Sometimes the markets don't move they way they should. SP up 5 cents now. On its way to $2.50..

[alokdhir]

So $37m npat? ish
Current PE 7.22 ISH

Gee this is easy worth over $2.50

Only problem with these cyclicals is that they dont command high PEs ...reliability of long term dividend is always a suspect ...so even temporary high dividends also dont move SP as expected ...only if they can convince markets about their earnings and thus dividends reliability then surely PE of 10+ ...

Holder and excited with results . Still expect over $ 2 in better market conditions ahead

[winner69]

Only problem with these cyclicals is that they dont command high PEs ...reliability of long term dividend is always a suspect ...so even temporary high dividends also dont move SP as expected ...only if they can convince markets about their earnings and thus dividends reliability then surely PE of 10+ ...

Holder and excited with results . Still expect over $ 2 in better market conditions ahead

Cyclicals have low PEs as they head to the top of the cycle .... and high PEs near the bottom of the cycle

[alokdhir]

Cyclicals have low PEs as they head to the top of the cycle .... and high PEs near the bottom of the cycle

So till PE becomes 12 ...its going up ...But PE goes up as earnings decline and thus dividends ....then eventually SP catches up down ...What part of cycle at present in your view ...past middle or first 30% ?

[winner69]

So till PE becomes 12 ...its going up ...But PE goes up as earnings decline and thus dividends ....then eventually SP catches up down ...What part of cycle at present in your view ...past middle or first 30% ?

Lets say about about half way up --- that gives room for a $2.50 share price some time ..... maybe wishful thinkng

[alokdhir]

Lets say about about half way up --- that gives room for a $2.50 share price some time ..... maybe wishful thinkng

I think u can be right if market conditions support ...But IMO most of the gains of cyclicals are in first 50% of the cycle ...

[winner69]

Good to see gross margins getting up there - 22.8% a great improvement on last couple of years but still room for improvement. Before they stuffed up a few years gm was running at 24%/26%

[Shepherd]

Can anyone tell me Vulcan's gross margin by way of comparison? Certainly very pleased with today's report. Having held for a number of years and averaged down at 90c, I am almost back in profit. Should have paid more attention to the cyclical nature of the stock and sold out on the way down. The CEO also deserves credit for righting the ship.

[winner69]

STU increased GM% from 20.6% to 22.8% in H1--up 2.4% points (12%)

Vulcan increased GM% from 35.2% to 41.2% -- up 6% points (17%)

Jeez just imagine if STU really pulled their finger out and managed to improve margins as much as Vulcan -- would have increased EBIT by about $3m

Must try harder Mr Malpass - your competitors are getting better prices in the market place at the moment (or buying better or both)


The 41% v 23% GM difference not as bad as it looks (from STU point of view) as different methodology re reporting margins .... but STU should be doing much much better than they are

[Shareguy]

Some good questions on the investor call including this one.

The margin comparison is a little misleading. Stu includes freight and labour costs in there gm. Vulcan does not. Mark said that as a comparison stu would be in the high 30”s excluding the freight. So still a difference but a lot closer. A lot of the difference is down to Vulcans downstream plate and coil processing which is at high margin. Stu are planning on addressing that with some investment in this area.

CEO also stated that the second half has started well with Jan 33 percent up.

Jarden and others very complimentary on the call to a fantastic result.

I think the share price is doing pretty well considering on how the dow ended up and with what’s going on with Covid and the Russians.

Very confident however that there will be a number of fund managers and investors looking at this result and thinking to themselves there is still a lot of upside.

Historically Steel and Tube has always traded similar to other distribution/building companies at a pe well above the current level. That was when stu had a lot of debt, so the current discount to me is unwarranted.

Steel and Tube seems to be well run these days and Mark certainly is saying all the right things in my opinion. For me it’s a case of waiting and watching for the market to take note. And while I wait will enjoy one of the highest dividends on the NZX.

[sb9]

Thanks SG for your snippets. $2 here we come once the Russian thing settles down.

[Recaster]

Hello everyone. First post. Glad to join the forum!

The operating cash flow is -9.6 mn which is concerning. If the dividend is added which it could be as it is a cost of capital (although discretionary and counter to IFRS) then the cash flow is -15.1 mn. Massive reversal of prior interim period amount. Negative operating cash flow is often a warning sign.

[percy]

Some good questions on the investor call including this one.

The margin comparison is a little misleading. Stu includes freight and labour costs in there gm. Vulcan does not. Mark said that as a comparison stu would be in the high 30”s excluding the freight. So still a difference but a lot closer. A lot of the difference is down to Vulcans downstream plate and coil processing which is at high margin. Stu are planning on addressing that with some investment in this area.

CEO also stated that the second half has started well with Jan 33 percent up.

Jarden and others very complimentary on the call to a fantastic result.

I think the share price is doing pretty well considering on how the dow ended up and with what’s going on with Covid and the Russians.

Very confident however that there will be a number of fund managers and investors looking at this result and thinking to themselves there is still a lot of upside. Historically Steel and Tube has always traded similar to other distribution/building companies at a pe well above the current level. That was when stu had a lot of debt, so the current discount to me is unwarranted.

Steel and Tube seems to be well run these days and Mark certainly is saying all the right things in my opinion. For me it’s a case of waiting and watching for the market to take note. And while I wait will enjoy one of the highest dividends on the NZX.

Thanks for sharing.

[Muse]

Some good questions on the investor call including this one.

The margin comparison is a little misleading. Stu includes freight and labour costs in there gm. Vulcan does not. Mark said that as a comparison stu would be in the high 30”s excluding the freight. So still a difference but a lot closer. A lot of the difference is down to Vulcans downstream plate and coil processing which is at high margin. Stu are planning on addressing that with some investment in this area.

CEO also stated that the second half has started well with Jan 33 percent up.

Jarden and others very complimentary on the call to a fantastic result.

I think the share price is doing pretty well considering on how the dow ended up and with what’s going on with Covid and the Russians.

Very confident however that there will be a number of fund managers and investors looking at this result and thinking to themselves there is still a lot of upside.

Historically Steel and Tube has always traded similar to other distribution/building companies at a pe well above the current level. That was when stu had a lot of debt, so the current discount to me is unwarranted.

Steel and Tube seems to be well run these days and Mark certainly is saying all the right things in my opinion. For me it’s a case of waiting and watching for the market to take note. And while I wait will enjoy one of the highest dividends on the NZX.

thanks for passing that on shareguy. and for all your good work & analysis on this - and for doing the brokers job for them!
re valuation I think it will ultimately just boils down to what forward dividends STU can pay and forward yield it can offer. ditto for vulcan. the implied valuation metrics (PE, EV/EBITDA,EV/EBIT) become just outcomes of the yield, rather than drivers to the price.
pleased to have backed both horses

[Southern Lad]

By my reckoning STU has likely used up its tax losses as at 31 December 2021 and therefore future dividends are likely to have imputation credits attached. This improves the dividend yield in shareholders hands and should help the share price.

While moving back to paying tax will use up some cash flow (compared with 1H22 where the tax expense largely arose due to reduction in the deferred tax asset previously recognised on prior tax losses), the STU dividend policy is 60% - 80% of adjusted NPAT so prima facie the cash dividend won’t be adjusted down once tax payments recommence.

At 30 June 2021, the deferred tax asset on tax losses was $5.334m, which at a 28% tax rate equates to gross tax losses of $19.05m. In the six months to 31 December 2021, the net profit before tax was $20.009m. Admittedly there will be some differences between accounting and taxable profit.

[Lifestyle]

Stay away from deferred tax. It is the tax difference between accounting profit and tax profit. It is really yukky stuff.

The balance sheet at 31/12/21 has income tax receivable of $1.361m. By 30/6/22 there will be an income tax liability. By the time the tax return is filed and terminal/provisional tax is paid, it may well be later in the year the actual tax is paid and available to be attached to dividends as imputation credits. So I think the final dividend and the next interim dividend will also have no imputation.

Sorry for the bore.

[Beagle]

If they make $30m after tax, (yes I know others are talking higher EBIT's which implies more but let's be a little conservative), that's 18 cps and if they pay out 70% of that its 12.6 cps fully imputed = 17.5 cps gross, (12.6 / 0.72), and on a $1.67 share price that a gross yield of ~ 10.5% !

$35m after tax, say in FY23 would be 21 cps and could lead to 15 cps fully imputed dividends which would be 20.83 cps gross and a gross FY 23 yield of ~ 12.5%

Not saying it will happen, just playing with my steam powered abacus around the possibility of it being that way.

Need nerves of steel (you see what I did there) :) to hold through all the geo political and Covid garbage at present. I am only recently on board so I have a full tank of patience to hold and see what happens here.

[sb9]

Post results, seems as though STU has performed better than VSL.

Let's see if we can demolish that big wall at 1.70, which was previous high.

[Shareguy]

Forbar have increased target price to $1.85. Buyers still getting the 5.5 c dividend. Just need a good day on the Dow for $1.70 to be broken.

[alokdhir]

Why STU down today ? Any news ? Dont think it went ex div today ..thats 10th March ...wondering why so ...VSL is up

[Shareguy]

No news. Stu up 4 cents for the week and Vulcan lost 32 cents.. Who’s been buying? I certainly have and great to wake up and see the Dow up 800. $2.00 not far away.

[alokdhir]

No news. Stu up 4 cents for the week and Vulcan lost 32 cents.. Who’s been buying? I certainly have and great to wake up and see the Dow up 800. $2.00 not far away.

As yesterday was down 5% while market up ...so thought maybe some negative fallout of Russian misadventure ?

[winner69]

No news. Stu up 4 cents for the week and Vulcan lost 32 cents.. Who’s been buying? I certainly have and great to wake up and see the Dow up 800. $2.00 not far away.

As VSL share price falls so does it PE eh .... now 12

Apply that to STU and discount for VSL size and ASX connections you get about 170/175 (my calcs)

But your 2 bucks seems good if it ever eventuates -- even if it takes somebody to take it over

[SailorRob]

No news. Stu up 4 cents for the week and Vulcan lost 32 cents.. Who’s been buying? I certainly have and great to wake up and see the Dow up 800. $2.00 not far away.

Are you in your 70's or 80's Shareguy? If not then waking to the Dow up should make you want to vomit. I'd love you to run me through the math of it being good to see it up 800 points upon awakening.

[Shareguy]

Are you in your 70's or 80's Shareguy? If not then waking to the Dow up should make you want to vomit. I'd love you to run me through the math of it being good to see it up 800 points upon awakening.

No just an early riser. I have been busy buying and last week was most likely the end of me buying for a while. I no there is a lot of people that think the worst is yet to come, and it maybee, but I’m thinking positive so upwards and onwards.

[alokdhir]

As VSL share price falls so does it PE eh .... now 12

Apply that to STU and discount for VSL size and ASX connections you get about 170/175 (my calcs)

But your 2 bucks seems good if it ever eventuates -- even if it takes somebody to take it over

Thats is W69's polite way of saying ...." Not easy mate " ...lol

[SailorRob]

No just an early riser. I have been busy buying and last week was most likely the end of me buying for a while. I no there is a lot of people that think the worst is yet to come, and it maybee, but I’m thinking positive so upwards and onwards.

If thinking positive means wanting higher prices on the Dow or otherwise then I don't understand. Unless you're planning to sell for either consumption or market timing (to sell, hope for decline then repurchase) the math doesnt check out.

Thinking positive means wishing for amazing assets and cash flows from them will be available for purchase at drastically reduced prices, with either future income or said cash flows.

Rising Dow etc will make us feel good but make us poorer in future unless you are selling down portfolio for consumption.

Buffett in his latest letter absolutly detests current prices. Positive thinking to him is to wake to a dramatically lower Dow.

Maybe there's something I don't get.

[Rawz]

Hey SailorRob did you buy into that russian bank in the end?

[SailorRob]

Hey SailorRob did you buy into that russian bank in the end?

Yeah, sheer luck but I'd been stalking it for a while and didn't buy all my Roubles pre invasion but had taken an original position. Doubled it near the lows the night of the invasion as well as Gazprom and Lukoil. Have topped up more since. The Sanctions on the other banks will benefit Sberbank, there is very little anyone can do without sending oil skyrocketing, Europe is extremely dependent on Russian gas. Opportunity of a lifetime in Russian equities at the moment. Was incredible watching and participating in trade on the MOEX during that session. Lots of freeze ups and crazy volatility.

[SailorRob]

Hey SailorRob did you buy into that russian bank in the end?

Down around 30% on Sberbank average price. Rouble probably get hammered tomorrow as well...

[sb9]

Forget $2, the way things are going, we might be heading back down to $1.50. Market still doesn't buy STU turnaround story.

[Arbroath]

Forget $2, the way things are going, we might be heading back down to $1.50. Market still doesn't buy STU turnaround story.

Fine with me. Topped up again at 1.58 yesterday.
No debt. Huge cash flows. Market can’t deny forever that the company is now more efficient and a very different proposition to 2-3 years ago. Might have to wait for another upgrade for it to sink in?

[BlackPeter]

Forget $2, the way things are going, we might be heading back down to $1.50. Market still doesn't buy STU turnaround story.

What is your "investing" time window - hours, days or even weeks?

For anybody thinking in investment timeframes it doesn't need a rocket scientist do see that this stock is in a nice uptrend. $2 by end of the year looks would look achievable to me ... (based on the power of linear extrapolation :p );

13567

You know, they say - "Patience is a virtue";

[sb9]

What is your "investing" time window - hours, days or even weeks?

For anybody thinking in investment timeframes it doesn't need a rocket scientist do see that this stock is in a nice uptrend. $2 by end of the year looks would look achievable to me ... (based on the power of linear extrapolation :p );

13567

You know, they say - "Patience is a virtue";

Hmmm, not sure where you're coming from. Have been invested in STU for more than a year now from under 80c days. Hope that clarifies your line of "Patience is a virtue"...

[BlackPeter]

Hmmm, not sure where you're coming from. Have been invested in STU for more than a year now from under 80c days. Hope that clarifies your line of "Patience is a virtue"...

So - what are you worried about? So far I only see some random noise on the way up ...

[sb9]

So - what are you worried about? So far I only see some random noise on the way up ...

I'm not worried and that's the last thing I would do. It was just a general comment around current price trend after that huge result last week.

[winner69]

‘Be patient’ and ‘buy the dips’ and ‘Long-term investors need to remain calm.’ Seems to be common advice in these times.

Heard one commentator say the other day - Those things aren’t advice —they’re bull **** platitudes without any real data, math, or investing process to back them up

[BlackPeter]

‘Be patient’ and ‘buy the dips’ and ‘Long-term investors need to remain calm.’ Seems to be common advice in these times.

Heard one commentator say the other day - Those things aren’t advice —they’re bull **** platitudes without any real data, math, or investing process to back them up

Well, that's the thing with "commentators" - none of them knows more about the future than anybody else, and if they pretend they do they produce only bull **** and platitudes as anybody else :p;

Having said that - if your time horizon is long enough and your investments are diversified, than ‘Be patient’ and ‘buy the dips’ and ‘Long-term investors need to remain calm was in the past always right. While trying to predict the future sometimes works for a small number of random few, the overwhelming majority of panickers are loosing out - every time.

I know that you love to bait people, but still - sometimes your posts are annoying, particularly considering that you are knowing better.

[percy]

‘Be patient’ and ‘buy the dips’ and ‘Long-term investors need to remain calm.’ Seems to be common advice in these times.

Heard one commentator say the other day - Those things aren’t advice —they’re bull **** platitudes without any real data, math, or investing process to back them up

Had he read Trillions by Robin Wigglesworth,he may have known better and kept his trap shut.

[Shareguy]

Craigs has STU as the highest dividend return on the NZX at 11 percent for this year. Must be a mistake…..

[Balance]

Craigs has STU as the highest dividend return on the NZX at 11 percent for this year. Must be a mistake…..

F22 year?

Analysts have been busy upgrading their earnings & dividends forecasts since the results so could well be correct if it's F22.

[see weed]

Craigs has STU as the highest dividend return on the NZX at 11 percent for this year. Must be a mistake…..
The next div is up 350% from 2021 March div from 1.21c to 5.5c next week. I have been buying up on the dips for next div.

[see weed]

Craigs has STU as the highest dividend return on the NZX at 11 percent for this year. Must be a mistake…..
Yes, and Beagle mentioned something along the same lines last week.

[see weed]

If they make $30m after tax, (yes I know others are talking higher EBIT's which implies more but let's be a little conservative), that's 18 cps and if they pay out 70% of that its 12.6 cps fully imputed = 17.5 cps gross, (12.6 / 0.72), and on a $1.67 share price that a gross yield of ~ 10.5% !

$35m after tax, say in FY23 would be 21 cps and could lead to 15 cps fully imputed dividends which would be 20.83 cps gross and a gross FY 23 yield of ~ 12.5%

Not saying it will happen, just playing with my steam powered abacus around the possibility of it being that way.

Need nerves of steel (you see what I did there) :) to hold through all the geo political and Covid garbage at present. I am only recently on board so I have a full tank of patience to hold and see what happens here.
Same here, been topping up from $1.49 last December. 9%+ yld, another 5 days before ex div. and sp at $1.56 atm. Get in now and grab a bargain before it hits $1.70;)

[Ekrub]

Good to see the SP holding up, or even improving (as at 1600) on ex-div day. Augurs well, as they say.

[Recaster]

Just looking at the accounts without getting into predictions or valuations. My take on this company:

Interim Accounts to 31 December, 2021

https://recastinvestor.substack.com/p/update-steel-and-tube-stunzx

Annual Accounts to 30 June, 2021

https://recastinvestor.substack.com/p/basic-analysis-steel-and-tube-stunzx

Comments for improvements greatly appreciated.

[Scrunch]

Just looking at the accounts without getting into predictions or valuations. My take on this company:

Interim Accounts to 31 December, 2021

https://recastinvestor.substack.com/p/update-steel-and-tube-stunzx

Annual Accounts to 30 June, 2021

https://recastinvestor.substack.com/p/basic-analysis-steel-and-tube-stunzx

Comments for improvements greatly appreciated.

My biggest observation is that within the financial statements for 31 Dec 2021 there are $99m of lease liabilities and $80.9m of right of use assets and only $2m of bank debt. Within this analysis these operational leases are presented as "interest bearing debt" and "Fixed assets" and I think it may be better to preserve the lease liability / right of use structure rather than try and simplify it as being interest bearing debt/fixed assets.

Surplus cash can't readily be applied to repaying this "debt" because its just future year rental payments. There is limited potential to sell the "right of use asset" when there is usually at least the option of selling fixed assets. In a rising interest rate environment, you won't get the same interest rate expense increase shock from lease liabilities as you get from bank debt. Typically commercial leases do not have financial covenants that would apply to bank based debt, so if there was a decline in performance you won't be beholden to the bank the same way as if you owed and couldn't repay $100m. I can understand why they made the accounting standards change, but its still a work-in-progess how to deal with these new items on the financial statements.

[Recaster]

Great point Scrunch, thanks for the feedback. I had considered the issue and decided to go the simplicity route but I'll have a think about whether to keep doing it that way. The whole ROU is a thorny issue; one main thing is to make sure the ROU interest goes to funding costs. Perhaps I'll just make a note in the analysis on the subject. Cheers.

[winner69]

Good work recaster

Love your comment 'The company blew through $21.8 mn of cash '

Cheers

[Poet]

Rebuilding steel margins as prices soar | BusinessDesk (https://businessdesk.co.nz/article/infrastructure/rebuilding-steel-margins-as-prices-soar)

Informative article for those with access

[Poet]

Good work recaster

Love your comment 'The company blew through $21.8 mn of cash '

Cheers

They increased inventory levels considerably in that half year and will now be making windfall profits both by having available stock and by having stock bought at lower prices before the latest world ructions caused even more price inflation. Smart moves IMO even if it does deteriorate the balance sheet temporarily. I think this company is on a positive
roll since the new leadership took over.

[Recaster]

Yes, perhaps 'blew through' was the wrong choice of words. Apologies.

[winner69]

Yes, perhaps 'blew through' was the wrong choice of words. Apologies.

No need to apologise …say what you think

‘Blew through’ and ‘cash burn’ are real things though

A while ago many were clamouring for a share buy back / special divie to use up millions sitting in the bank but now they invested in inventory it’s a great move. Hope it turns out all OK

[nztx]

Additional levels of more expensive inventory, or the higher cost of inventory carried now
has swallowed the Cash ?

What happens when & if inventory supplies & costs normalise or even fall ?

What goes up usually comes down, sometimes in a hurry too, as
market conditions change :)

A large inventory impairment expense (yet again) ? ;)

Would STU be nimble enough to quit high cost inventory in a hurry
or are they only importing / buying to cover fixed customer orders ?

Look no further than the past 5 year STU track record for history of
some of the write downs, impairments & losses and who stumped up
after the event to fix the job :)

Folk think things look like plain sailing, while behind the scene, the market is rapidly
changing - only reported some months down the track :)

Sorry to crash the images of all now recovered & sweet, but commodity & materials
markets can be especially volatile ..

Look no further than Magnesium, Li, Vanadium etc etc and of course Fe
The volatility is seem in the global effects of supply & demands of these.

[winner69]

Additional levels of more expensive inventory, or the higher cost of inventory carried now
has swallowed the Cash ?

What happens when & if inventory supplies & costs normalise or even fall ?

A large inventory impairment expense (yet again) ? ;)

ZEL see huge swings in profitability at times when input costs move up or down big time. …and they report two profits …..historic cost and replacement cost

We need to to have faith in STU management that their systems are working properly now and that they keep track of the stock and the stock they’ve got is what they need and won’t become obsolete,

Didn’t they need to ‘write off ‘ more than $20m of stock a few years ago. …stuff they couldn’t find and stuff that was obsolete

[nztx]

ZEL see huge swings in profitability at times when input costs move up or down big time. …and they report two profits …..historic cost and replacement cost

We need to to have faith in STU management that their systems are working properly now and that they keep track of the stock and the stock they’ve got is what they need and won’t become obsolete,

Didn’t they need to ‘write off ‘ more than $20m of stock a few years ago. …stuff they couldn’t find and stuff that was obsolete

I think you're right - there was a large inventory write off a few years back

The proof with STU will be when the pudding comes out- maybe not next reporting but further periods ahead
on how nimble the Chefs at STU are in dealing with market condition changes IMO

The Chinese influence on the Fe price is fairly large

BHP seem to recording a good run currently from my reading

Gina Reinhart also appears to be having a good run (in Oz)

The Tasmanian Iron Pellet GRR also appear to be having a good run

Periodically China screams loudly about 'realistic pricing' on it's buys of materials

but all that could easily change - just one Ozzie politician with a few words out of place
is all it could take, among other things ;)

Movements in global markets & conditions will all be affecting STU's COGS, purchasing
and availability of replacement stock I imagine ..

[winner69]

Shareguy et al ….do some raving about STU to cheer up those worried about the share price crashing ….give them cause not too worry

[winner69]

STU share pirice hit 143 this morning ..... lowest it's been this year

Must be something to do this upcoming recession ..... or maybe the soon to be nickel shortage

[Rawz]

Winner has gone fishing again. What's in the STU sea? No bites thus far

[winner69]

Winner has gone fishing again. What's in the STU sea? No bites thus far

Exciting flyover of 4 jets a while ago was pretty noisy ….apparently some old airforce chief funeral deserved such an honour.

[alokdhir]

Winner has gone fishing again. What's in the STU sea? No bites thus far

W69 has a point ...Since this war started both steel stocks ...VSL and STU have not done well ...for reasons which will be known to us latter ...But it did effect them ...

[Rawz]

W69 has a point ...Since this war started both steel stocks ...VSL and STU have not done well ...for reasons which will be known to us latter ...But it did effect them ...

Im looking at my portfolio and watchlist of stocks i want to add to my portfolio.. and nothing doing well mate

[Sparky669]

You are not alone..None of the NZX stocks was above its 20d moving average this morning, and Nasdaq is crowded with dumpers since the war started.

[alokdhir]

Im looking at my portfolio and watchlist of stocks i want to add to my portfolio.. and nothing doing well mate

NZR and PPH are doing ok recently ...:p

CEN and IFT outperforming markets by falling less YTD

[Shareguy]

At close today 23/11/21. Vulcan Steel continues to climb at $8.40. Steel and Tube at $1.30

Will revisit this post in a year and compare the best return. I no what I’m betting on….


After seeing winner69 post I have reviewed the current prices

Stu at $1.45 up 11 percent from original post and Vulcan at $9.11 up 8.5 percent.

My point is that given the current situation both the stocks have feared well in my opinion. As far as steel and tube is concerned nothing has changed, we still have huge demand and I’m still very bullish and expecting a cracker full year result.

I am sure that there is a number of investors that are still on the fence after years of dismal performance. Both businesses are solid inflation proof hedges with a very bright future. With the third-quarter coming to a close hopefully we will get some numbers for full year soon.

I do however think at the current price stu is looking like an attractive takeover play and also Craig’s have stu as the highest dividend return on the Nzx. I’m happy to sit back and see what happens.

[mcdongle]

Where does STU get most of its steel from?

[Dassets]

60 to 65% I think from NZ either new or recycled

[mcdongle]

60 to 65% I think from NZ either new or recycled

Thanks.......

[Balance]

Must be about time for another profit upgrade from STU?

Last one was 3 months ago and all indicators out there are that trading conditions are extremely strong for the sector.

Talked to a commercial property developer yesterday and he said that for his 7 storey mixed development in Auckland, he is having to book his steel requirements out 6 months with no prices fixed! Banks are also insisting with developers that the developers only use reputable construction companies/builders now who can access building materials before approving loans.

https://www.nzx.com/announcements/384714

[Co0p_New]

s&t have plenty of sales/account management type roles listed on SEEK. Could bode well for the future....

[Balance]

Boom times continue for the construction sector - in Christchurch greater area.

Usual story however about price increases & delays in getting building material however.

https://www.stuff.co.nz/business/property/128201892/housing-construction-tops-2-billion-in-greater-christchurch

[JohnnyTheHorse]

Must be about time for another profit upgrade from STU?

Last one was 3 months ago and all indicators out there are that trading conditions are extremely strong for the sector.

Talked to a commercial property developer yesterday and he said that for his 7 storey mixed development in Auckland, he is having to book his steel requirements out 6 months with no prices fixed! Banks are also insisting with developers that the developers only use reputable construction companies/builders now who can access building materials before approving loans.

https://www.nzx.com/announcements/384714

Mirrors what I'm seeing in the commercial sector too. Essentially STU can name their price and people will pay.

[winner69]

Housing consents smash 48-year record

https://www.interest.co.nz/property/115103/residential-construction-still-booming-new-dwelling-consents-25-year-february

[BlackPeter]

Housing consents smash 48-year record

https://www.interest.co.nz/property/115103/residential-construction-still-booming-new-dwelling-consents-25-year-february

Good. However - just wondering, whether they will build all these new houses completely with steel? Maybe they leave a handful of dollars for other building materials and windows :) ?

[Balance]

Good. However - just wondering, whether they will build all these new houses completely with steel? Maybe they leave a handful of dollars for other building materials and windows :) ?

No. They are all built with sawdust and leaves.

[Shareguy]

Steel & Tube saying prices will continue to go up. Higher margin dollar per tonne/item is going to mean higher profit. Can we have an update please Mark Malpass.

https://steelandtube.co.nz/sites/default/files/Steel%20%26%20Tube_Procurement_Update_March_2022.p df

[Balance]

Steel & Tube saying prices will continue to go up. Higher margin dollar per tonne/item is going to mean higher profit. Can we have an update please Mark Malpass.

https://steelandtube.co.nz/sites/default/files/Steel%20%26%20Tube_Procurement_Update_March_2022.p df

Steel supply situation still very tight out there according to builders I have talked to but manageable as long as orders are made in advance.

Something which would be of interest to some posters :

Met a construction company which specializes in using mostly steel & concrete for all their buildings (residential, industrial & commercial) and found the meeting to be most beneficial & revealing. Their building method is certainly not conventional for NZ but well established overseas.

They have been in business for just over 10 years and have completed $3 billion of construction projects in that time with an ever growing order & project pipeline.

With the increases in building material costs, especially timber and cladding materials, they can now construct buildings cheaper with steel & concrete (saving around $300 sq meter) as well as shorten the construction time by several months. Our team have evaluated the numbers and can confirm that their numbers stack up.

I asked about the steel supply situation and they said that it could become problematic in the short term if more players in the industry switch over to their building method but that's not going to happen as the industry is pretty backward in adopting 'new' techniques. Longer term, they see more and more players using steel & concrete - which is used extensively overseas, especially in Asia.

We are working through using them for a project now and so far, we are most impressed.

[Dlownz]

Vulkan steel just updated. Come on STU Where's your update

[JohnnyTheHorse]

Vulkan steel just updated. Come on STU Where's your update

A pretty massive upgrade at that too.

[winner69]

A pretty massive upgrade at that too.

Jeez FY guidance up 24% --- huge

Just imagine if STU are doing that well

[Shareguy]

Stu will also have a fantastic result. Craigs have eps fy22 of 17.85 cps so a pe of 8. And if that does not get you going a 12 percent divi. Market says rubbish as shown by pathetic share price OR is the market wrongly pricing this stock.

[see weed]

Vulkan steel just updated. Come on STU Where's your update
maybe in July

[winner69]

Always a good sign when Independent Director buys shares

Vote of confidence from Stephen

[SailorRob]

Always a good sign when Independent Director buys shares

Vote of confidence from Stephen

It's better than nothing but jeez, is that amount really a vote of confidence?

A vote of confidence would be a significant portion of his entire net worth, or better still a multiple of his net worth.

[winner69]

Looks like high flying construction related stocks aren't immune from market crashes


Maybe STU share price is signalling the building boom is over .... expensive materials (if you can get them), no labour and if they have labour it costs them heaps, proposed activity not going ahead (finances etc) etc etc etc

Maybe construction not the place to be after all

[SailorRob]

Looks like high flying construction related stocks aren't immune from market crashes


Maybe STU share price is signalling the building boom is over .... expensive materials (if you can get them), no labour and if they have labour it costs them heaps, proposed activity not going ahead (finances etc) etc etc etc

Maybe construction not the place to be after all

Yeah who knows, certainly could be though. I sold down a while back when Shareguy was going absolutely ballistic, animal spirits in fine form. Timing these crappy cyclical businesses is very difficult to do.

[Rawz]

Yeah who knows, certainly could be though. I sold down a while back when Shareguy was going absolutely ballistic, animal spirits in fine form. Timing these crappy cyclical businesses is very difficult to do.

Sold down and bought into a Russian bank as the record says. Should have stayed with the animal spirits!!

STU priced for a recession. Must be on a P/E if about 5 by now?

[SailorRob]

Sold down and bought into a Russian bank as the record says. Should have stayed with the animal spirits!!

STU priced for a recession. Must be on a P/E if about 5 by now?

Yes I should have. Currently down 26% in NZD on the Russian bank, though I can't sell and the quoted price may not be real if the exchange was open to the world. The Rouble is by far the strongest currency in the world YTD however.

Regarding STU, this years earnings are of little interest to anyone particularly the market. As we're buying the future net cash flows and discounting them back to present there is more to think about and a great place to look is the past with a business like this. Look at revenue growth over 15 years, look at capital allocation, margins...

Yes things might be looking up taking a snapshot right now but old habits die hard and if we assume nothing much will change then it's actually trading more like 13-14 x sustainable long term earnings. If, as some people are assuming STU is a totally new company and can paint a much different picture going forward than they ever have in past then who knows. I'd rather stick with Sberbank, one of the worlds best banks which has one of the best track records in existence.

Most of what we're seeing here is nothing to do with STU anyway, just the industry giving them a cyclical boost. And apart from the divvy, god only knows what stupid thing they decide to do with the retained earnings. Not buying in stock under 80c was criminal.

[percy]

https://www.nzx.com/announcements/392143

[Co0p_New]

https://www.nzx.com/announcements/392143

Makes for good reading. Although spent of plenty of cash on inventory.

[BlackPeter]

https://www.nzx.com/announcements/392143

WOW!

Assuming the remaining 2 months of the FY go as well as the first 10 did, they might end up with $600m revenue and 17.4 cents EPS, which would be roughly 7.5% above the previous analyst consensus (for revenue) and even 10% higher for earnings. Speaks as well for a further improvement of their margins and might justify a wee price nudge upwards.

They are clearly riding the wave ...

[Rawz]

WOW!

Assuming the remaining 2 months of the FY go as well the first 10 did, they might end up with $600m revenue and 17.4 cents EPS, which would be roughly 7.5% above the previous analyst consensus (for revenue) and even 10% higher for earnings. Speaks as well for a further improvement of their margins and might justify a wee price nudge upwards.

They are clearly riding the wave ...

Yes and thus trading on a P/E of 8.2. Value stock right here

[Beagle]

Yeah, ride the wave while its high but this is unquestionably a classic cyclical stock and importantly does not have the history of many years of strong and reliable dividend payments for me to classify it as a reliable source of retirement income, which is my main focus now.

[Rawz]

Market likes it. Up 6.5%

On its way back to 2 bucks

[Beagle]

What's the tax adjusted PE ? One thing to make XYZ when they have prior year tax losses but adjust that for tax and you get a tax normalised PE and then remember that whatever that number is, this could be the peak of the cycle.

[SailorRob]

What's the tax adjusted PE ? One thing to make XYZ when they have prior year tax losses but adjust that for tax and you get a tax normalised PE and then remember that whatever that number is, this could be the peak of the cycle.

Exactly Beagle. A super high PE is what you buy these on, not low. There is an E in PE and the ratio will be low and look like great value to the uninitiated at the top of the cycle. When earnings are washed out and margins compressed the PE will be high.

[SailorRob]

Yeah, ride the wave while its high but this is unquestionably a classic cyclical stock and importantly does not have the history of many years of strong and reliable dividend payments for me to classify it as a reliable source of retirement income, which is my main focus now.

It does however have a history... And that history will tell you all you need to know!

[Beagle]

Exactly Beagle. A super high PE is what you buy these on, not low. There is an E in PE and the ratio will be low and look like great value to the uninitiated at the top of the cycle. When earnings are washed out and margins compressed the PE will be high.

Think AIR got to a seductive looking tax paid PE of 7 at the top of their earnings cycle. That's the thing with true cyclical companies isn't it. The view always looks great from the top of the mountain !

I'm out. We're going into a recession soon (possibly a deep and long one), as sure as night follows day.

I want stocks that can pay me 8% gross with a high degree of reliability throughout my retirement years.

[Shepherd]

Hi Beagle, I would be interested o know what >8% dividend stocks curranty meet your criteria?

[winner69]

Think AIR got to a seductive looking tax paid PE of 7 at the top of their earnings cycle. That's the thing with true cyclical companies isn't it. The view always looks great from the top of the mountain !

I'm out. We're going into a recession soon (possibly a deep and long one), as sure as night follows day.

I want stocks that can pay me 8% gross with a high degree of reliability throughout my retirement years.

Good insight there Beagle

I've seen that play out many times ..... low PEs are often seductive

[Beagle]

Hi Shepherd,

On a gross yield basis for sustainable retirement income I like in alphabetical order :-
ARG (Its a PIE and only gross's up to around 8% if you are on a 33% tax rate)
GNE
HGH
TRA
WHS

KPG could be another one to consider but I have concerns as expressed in that thread.

Other 8 % payers worth considering when the timing is right is the Fisher Funds trio of Marlin, Barramundi, and Kingfish but all are trading at huge premiums to NTA and I have concerns that many of Marlin and Barramundi tech stocks in particular are vulnerable to a significant correction.

HLG has been a fabulous earner over the years but the recent significant reduction in the rate of imputation credits means they're currently quite a bit south of 8% and I am temporarily out of them as well until the current downtrend is well and truly over.

Hope that helps.

[Rawz]

Well you'll get the 8% gross part.. but yes, historically speaking.. no reliability. STU have been through big restructure/ turnaround.. so this time is going to be different (lol)
I dont know why but i am always attracted to companies coming out of the mud.

In the investor presentation https://www.nzx.com/announcements/392144 they acknowledge the residential housing market is moderating but still report strong secured pipeline of contract work. And in their guidance they say they "expect continued earnings momentum and dividends".. maybe we get the 8% gross for everrrrr

[Muse]

Hi Shepherd,

On a gross yield basis for sustainable retirement income I like in alphabetical order :-
ARG (Its a PIE and only gross's up to around 8% if you are on a 33% tax rate)
GNE
HGH
TRA
WHS

KPG could be another one to consider but I have concerns as expressed in that thread.

Other 8 % payers worth considering when the timing is right is the Fisher Funds trio of Marlin, Barramundi, and Kingfish but all are trading at huge premiums to NTA and I have concerns that many of Marlin and Barramundi tech stocks in particular are vulnerable to a significant correction.

HLG has been a fabulous earner over the years but the recent significant reduction in the rate of imputation credits means they're currently quite a bit south of 8% and I am temporarily out of them as well until the current downtrend is well and truly over.

Hope that helps.

what about MFB??? YUGE yield :)

out of sheer morbid curiosity I am going to do some work on MFB - run it under some harsh / anti embarrassment assumption scenarios - see what pops out the other side.

[SailorRob]

Why settle for 8% when you can get a guaranteed 10 and then have the worlds greatest take it all and reinvest it for you.

[Arbroath]

What's the tax adjusted PE ? One thing to make XYZ when they have prior year tax losses but adjust that for tax and you get a tax normalised PE and then remember that whatever that number is, this could be the peak of the cycle.

Correct me if I’m wrong Beagle but don’t the reported NPAT numbers have tax taken out but in the cash flows they don’t have to actually pay anything as have tax losses to use up.

So the PE is real but there has been no actual tax paid hence no imputation credits available until it seems FY23

[Shepherd]

Thanks Beagle, much appreciated.

[Balance]

STU is a money printing machine when it has great management - it operates in an oligopolistic essential industry with a few key players determining margins and market shares.

Question investors have to ask is whether STU has the right management (like during Nick Calavrias's era) to maximize its oligopolistic positioning in the industry.

[SailorRob]

STU is a money printing machine when it has great management - it operates in an oligopolistic essential industry with a few key players determining margins and market shares.

Question investors have to ask is whether STU has the right management (like during Nick Calavrias's era) to maximize its oligopolistic positioning in the industry.

And if so, why do said management own essentially no stock.

[Balance]

And if so, why do said management own essentially no stock.

Buy when management buys :

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/STU/372979/347129.pdf

[Shareguy]

My thoughts on yesterdays update.

Back last year I forecast EBIT of $50m for ye22. Guidance announced is not less than $45m.

Pleasing to see the margin improvement from 20.8% to 23% with operating costs as a percentage of sales further decreased. Costs have been drastically reduced with less sites and staff and a focus on profitable growth.

For those that think it’s all downhill from here.

No question the last few years have been a shocker, but if you look at history over the last 30 years you will find that STU has been consistently one of the higher dividend return stocks on the NZX and consistently traded on a much higher PE than current.

Today we have a diversified business with Fastening, Pipeing, Hurricane , Comflor and the highly profitable roofing division added over the years.

I know a lot of us brought under $1.00 and I’m not against taking a profit. However I think this stock is well worth holding with plenty of upside still to come. I’m sure it will continue to be one of the highest dividend returns with a real possibility of a takeover given the current pricing.

So I still see STU as one of the best opportunities on the NZX.

[Balance]

Then, there’re studies which show that high dividend yielding stocks bear up well better in stock markets during recessions.

https://www.investopedia.com/articles/stocks/09/dividend-yield-for-the-downturn.asp

[see weed]

Hi Shepherd,

On a gross yield basis for sustainable retirement income I like in alphabetical order :-
ARG (Its a PIE and only gross's up to around 8% if you are on a 33% tax rate)
GNE
HGH
TRA
WHS

KPG could be another one to consider but I have concerns as expressed in that thread.

Other 8 % payers worth considering when the timing is right is the Fisher Funds trio of Marlin, Barramundi, and Kingfish but all are trading at huge premiums to NTA and I have concerns that many of Marlin and Barramundi tech stocks in particular are vulnerable to a significant correction.

HLG has been a fabulous earner over the years but the recent significant reduction in the rate of imputation credits means they're currently quite a bit south of 8% and I am temporarily out of them as well until the current downtrend is well and truly over.

Hope that helps.
I notice HLG getting close today on ASB at 7.88% yld. MNW not so high but paying 51c div next month, might get a few more for div.

[SailorRob]

My thoughts on yesterdays update.

Back last year I forecast EBIT of $50m for ye22. Guidance announced is not less than $45m.

Pleasing to see the margin improvement from 20.8% to 23% with operating costs as a percentage of sales further decreased. Costs have been drastically reduced with less sites and staff and a focus on profitable growth.

For those that think it’s all downhill from here.

No question the last few years have been a shocker, but if you look at history over the last 30 years you will find that STU has been consistently one of the higher dividend return stocks on the NZX and consistently traded on a much higher PE than current.

Today we have a diversified business with Fastening, Pipeing, Hurricane , Comflor and the highly profitable roofing division added over the years.

I know a lot of us brought under $1.00 and I’m not against taking a profit. However I think this stock is well worth holding with plenty of upside still to come. I’m sure it will continue to be one of the highest dividend returns with a real possibility of a takeover given the current pricing.

So I still see STU as one of the best opportunities on the NZX.

Which says far more about the NZX than it does STU.

[Beagle]

I notice HLG getting close today on ASB at 7.88% yld. MNW not so high but paying 51c div next month, might get a few more for div.

Yes, they remain on my watch list mate.

[winner69]

The excitement from the guidance ann didn’t last long did it ….back to 137

Lowest close for a while

Media says recession fears making punters worried

[SailorRob]

Buy when management buys :

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/STU/372979/347129.pdf


Yawn. Lunch money. Entire holding probably a fraction of value of their house.

[Balance]

Yawn. Lunch money. Entire holding probably a fraction of value of their house.

Like I wrote, but when management buys. 50%+ return in a market which has gone backwards.

Yawn indeed! :t_up:

[clearasmud]

You're both right

[nztx]

I'll wake up when they get nearer to a buck :)

[SailorRob]

Like I wrote, but when management buys. 50%+ return in a market which has gone backwards.

Yawn indeed! :t_up:

Sorry, I read it as 'but' not buy.

Yep you're right. But they didn't wanna buy in stock in the 80's. Neither did most people here either.

[winner69]

Jeez into the 120s

A few more sleeps might be sub $1

Construction boom over …all turning to custard …..work not going ahead ….builders going broke ….bad debts …heck what a mess

[percy]

Jeez into the 120s

A few more sleeps might be sub $1

Construction boom over …all turning to custard …..work not going ahead ….builders going broke ….bad debts …heck what a mess

Steam pouring out of Winstone Wallboards factory.Full steam ahead.
Driving around ChCh,Rolleston,Hallswell,Linclon and Kaiapoi, construction full steam ahead.Housing,factories,warehouses.
Must be just a Canterbury thing.?

[Co0p_New]

Starting to look enticing to me…

[nztx]

Jeez into the 120s

A few more sleeps might be sub $1

Construction boom over …all turning to custard …..work not going ahead ….builders going broke ….bad debts …heck what a mess


Goodness .. what happened to all those forecast Good Times expected for a least two years ahead ? ;)

At this rate yesterday's Buck will have to inflation adjusted down to 81.69c to balance things out ..
taking into account STU's Opportunity Lost on them ..

There must be another Cap Raise rescue mission on the way sometime soon to sort out the loose ends
and expensive new stock that can't be rehomed for love nor money ?

[percy]

Goodness .. what happened to all those forecast Good Times expected for a least two years ahead ? ;)

At this rate yesterday's Buck will have to inflation adjusted down to 81.69c to balance things out ..
taking into account STU's Opportunity Lost on them ..

There must be another Cap Raise rescue mission on the way sometime soon to sort out the loose ends
and expensive new stock that can't be rehomed for love nor money ?
Send any excess stock to Christchurch.

[nztx]

Send any excess stock to Christchurch.

The inflated Freight Recovery will be crippling .. still game ? ;)

Have to recover all the other bits & pieces & shortfalls & losses somehow :)

[percy]

The inflated Freight Recovery will be crippling .. still game ? ;)

Have to recover all the other bits & pieces & shortfalls & losses somehow :)

Not so.
Buyers waiting.
Send it now freight forward.,.

[nztx]

Not so.
Buyers waiting.
Send it now freight forward.,.


Sorry Freight Forward unknown on the northern isthmus

Too many absconding leaving debts unpaid now - you know :)

[percy]

Another very positive presentation.
Trading well,with excellent growth prospects.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/STU/393518/372546.pdf

[cymonger]

Yes. Confirmed all the positive things we already knew about this year and beyond. Shame on the St "regulars" trying to scare people saying the construction industry was going bankrupt. As far as I'm concerned they should arrest these shameless market manipulators like they do over at Hotcopper.

(Seriously, they did just arrest someone in Melbourne for market manipulation on HC.)

[nztx]

Must still be some believers around .. one of the few to jump out a sea of red

wait until it becomes obvious that by some mysterious feat the buck has stopped going round as fast :)

A few here would probably guarantee to eat their hats if STU ever accelerated up past FBU :)

[sb9]

Both CEO and CFO see good value in here by buying 10K parcels on market, nice token of endorsement.

[Poet]

Both CEO and CFO see good value in here by buying 10K parcels on market, nice token of endorsement.

Although the attachments seem to be the same for both announcements (Both are in name of Richard Smyth). Maybe we see correct one for Mark Malpass later

[winner69]

Both CEO and CFO see good value in here by buying 10K parcels on market, nice token of endorsement.

Wonder how many Malpass bought

STU needs to take more care with their announcements .....not the first time something was wrong

Maybe idicative of culture at STU ...... bit careless and not enough concentration .... hope the guy doing quotes takes more care

[percy]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/STU/393642/372677.pdf

[winner69]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/STU/393642/372677.pdf


Is Ngaire his wife / partner?

[percy]

Is Ngaire his wife / partner?


Wife...............................

[sb9]

From a low of 1.18 intra day to close at 1.28, nice recovery.

[percy]

From a low of 1.18 intra day to close at 1.28, nice recovery.

I was going to top up yesterday at $1.26,the same price the CEO and CFO added to their holdings,but didn't.
Today I watched the share price drop and hit the buy button at $1.20, which caused the share price to drop to $1.18...lol.
I thought here we go again..!!!!
So pleasantly surprised to see the strong finish.
According to DB site STU's PE is 8.13 and their yield is 6.87%...At sp of $1.28.
Latest update was excellent with a very strong out look.
Bought for my long term dividend portfolio.

[Balance]

STU stood the bear market test today. Augers well for the year ahead.

[Beagle]

Cyclical's do not make reliable dividend payers over the medium to long term. Just ask AIR shareholders LOL

[percy]

Cyclical's do not make reliable dividend payers over the medium to long term. Just ask AIR shareholders LOL

Well I do not believe it is as cyclical as some people think.
Attached is their latest shareholder newsletter.Judge for yourself.
You could call it a building sector staple.?..lol.
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/STU/393518/372546.pdf

GROWTH TRAJECTORY
• We have a clear focus of
investment in high margin
products and customer segments
• We are currently commissioning
new plate processing equipment
in Auckland which will allow us to
grow in this higher margin market
• We have also introduced a
number of new high value
products and have a pipeline of
further opportunities to support
our continued revenue growth
• Looking forward, our larger
customers are generally reporting
solid forward workloads with
strong infrastructure markets and
a steady manufacturing sector,
partially offset by the expectation
of a softening residential market
in the second half of FY23

[Beagle]

History is against you with this company. I firmly believe history is the very best guide to the future. I also believe the housing market is going to crash not "soften". Jury is out on how enduring the infrastructure spending will be.
You can currently get 9-10% gross yields with some companies with a long and well proven dividend history that are recession proof, good example is GNE.
Good luck.

[percy]

History is against you with this company. I firmly believe history is the very best guide to the future. I also believe the housing market is going to crash not "soften". Jury is out on how enduring the infrastructure spending will be.
You can currently get 9-10% gross yields with some companies with a long and well proven dividend history that are recession proof, good example is GNE.
I don't see any need to punt on unproven cyclical's to achieve yield income in this Bear market.
Good luck.
Those of us with a very long memory will remember what a great company STU was.Always good solid results.
It appears to me they have done the hard work refocusing STU to back to basics.Strong sector reputation and growing market share,solid balance sheet and a good board and management.
I do not think luck has much to do with it,other than the more research I do the better luck I have.

[Beagle]

Those of us with a very long memory will remember what a great company STU was.Always good solid results.
It appears to me they have done the hard work refocusing STU to back to basics.Strong sector reputation and growing market share,solid balance sheet and a good board and management.
I do not think luck has much to do with it,other than the more research I do the better luck I have.

You might be right, time will tell. Serious Bear markets are generally very tough for the building sector and FBU's chart suggests to me there's real trouble coming for this sector as sure as night follows day. At least STU have done the hard yards with getting their balance sheet back into good shape. I guess you're hoping there's no more cheap Chinese steel structural issue skeletons lurking in the back of the closet.

[percy]

You might be right, time will tell. Serious Bear markets are generally very tough for the building sector and FBU's chart suggests to me there's real trouble coming for this sector as sure as night follows day. At least STU have done the hard yards with getting their balance sheet back into good shape. I guess you're hoping there's no more cheap Chinese steel structural issue skeletons lurking in the back of the closet.

I have not been to Auckland for sometime,however I expect the building of houses,warehouses,factories,malls,bridges etc is happening north,south ,east and west.using Steel reinforcing mesh,reinforcing steel,steel frame work ,roofing etc and is going gangbusters.Go for a drive and check it out for yourself.
It certainly is in ChCh and surrounding areas.Try getting a builder or consent from your local council.Months behind.Still plenty of pent up demand,which will not be satisfied for years.
STU are well placed for years.,and are a smaller better focused , more agile business than FBU, in my opinion.

[Rawz]

Hey Percy, yes the engine room of the economy is still humming away. No worries up here in the city of sails. Us hard working, long suffering Aucklanders will generate plenty of tax receipts to keep ya roads and bridges around the country up to date. Good news for STU that's a lot of steel required throughout that production process.

Our backs maybe sore from carrying the country but from the conversations I have with some Auckland customers that operate in the construction industry it is all systems go- strong pipeline of work ahead. Its actually kinda strange as there is heaps of talk of recession and downturn around but the work keeps coming in..?!?

Anyways when the Blues give the ole rusty Crusaders a good thrashing on Saturday night the whole city will be feeding off the high for months to come :cool:

All good for STU and happy holder here

[percy]

Hey Percy, yes the engine room of the economy is still humming away. No worries up here in the city of sails. Us hard working, long suffering Aucklanders will generate plenty of tax receipts to keep ya roads and bridges around the country up to date. Good news for STU that's a lot of steel required throughout that production process.

Our backs maybe sore from carrying the country but from the conversations I have with some Auckland customers that operate in the construction industry it is all systems go- strong pipeline of work ahead. Its actually kinda strange as there is heaps of talk of recession and downturn around but the work keeps coming in..?!?

Anyways when the Blues give the ole rusty Crusaders a good thrashing on Saturday night the whole city will be feeding off the high for months to come :cool:

All good for STU and happy holder here

Love the Blues/Crusaders battles.
Hopefully someone will take the pea out of the ref's whistle,and we have a great game.
STU.ChCh city Council are months behind with resource consents.I hear some developers have not bothered putting in for a consent yet,,Lack of skilled labour remains an issue ..So plenty of pent developments on hold.[including a certain stadium].Crikey if we loose to the Blues it will never be built...lol

[Beagle]

I have not been to Auckland for sometime,however I expect the building of houses,warehouses,factories,malls,bridges etc is happening north,south ,east and west.using Steel reinforcing mesh,reinforcing steel,steel frame work ,roofing etc and is going gangbusters.Go for a drive and check it out for yourself.
It certainly is in ChCh and surrounding areas.Try getting a builder or consent from your local council.Months behind.Still plenty of pent up demand,which will not be satisfied for years.
STU are well placed for years.,and are a smaller better focused , more agile business than FBU, in my opinion.

More than 100 builders and developers have gone bust so far this year and its only the tip of the iceberg. I would say there's at least another hundred that are presently insolvent but trying to bluff and build their way through this and hoping for the best. A perfect storm has developed of housing falling at the fastest pace in decades, building costs rising at the fastest pace ever, shortages of all sorts of materials and manpower and rapidly rising interest rates. Long Council delay's and archaic resource management act regulations are other serious issues.

I've been dealing with some interesting situations in my professional capacity in the last few weeks that I can't talk about on here. Let me just say that getting development finance is going to get extremely difficult going forward from here.
To cap it all off banks are already stress testing applicants at close to 8%, (probably more like 10% by this summer and most customers are failing the stress test), and sales level's are drying up. On another front how long will Labour's reckless infrastructure spending last ?
Most challenging conditions for developers I can ever recall. Costs up 21% in the last year and a similar increase expected in the next year and housing currently falling at about the same rate. Talk about being the meat in the sandwich ! Its not what's happening now, its what's coming that concerns me. You should be alright for another year, maybe two.

Agree with your last point about FBU but they are hardly setting a very high bar LOL

Speaking of them, are the same directors that turned down FBU's takeover offer at what was it now ?, from memory $1.90 ? many years ago because it undervalued the company still on the board at STU ? What a shocker that decision was and if I recall correctly shareholders were treated with utter contempt and never even got the chance to vote on it !

[BlackPeter]

Cyclical's do not make reliable dividend payers over the medium to long term. Just ask AIR shareholders LOL

True ... however they say as well to avoid to invest in anything which flies (planes) or floats (boats). This is a clear problem with AIR, but I don't see this issue with STU. Steel beams don't do either.

[Balance]

True ... however they say as well to avoid to invest in anything which flies (planes) or floats (boats). This is a clear problem with AIR, but I don't see this issue with STU. Steel beams don't do either.

No - they just sink?

[Shareguy]

Some very good posts on here lately. Steel and Tube has a long history of being a high dividend payer. Sure there has been a few haircuts along the way, but I believe the future looks bright. There is no doubt after releases by the company that it’s going to be a fantastic year. I don’t expect this to be a “one off”result and believe that the company is set for long-term sustainable growth. If you look at presentations from the company they aren’t reliant on anyone industry and so the current downtrend in housing is not going to be huge.

Apart from the juicy dividend, I firmly believe that it is ripe for a take over which is why it’s my largest position on the NZX.

[BlackPeter]

No - they just sink?

Actually, it depends. Only if you throw them into the water.

However - this is good. No uncertainty, and markets just love certainty.

[Balance]

Some very good posts on here lately. Steel and Tube has a long history of being a high dividend payer. Sure there has been a few haircuts along the way, but I believe the future looks bright. There is no doubt after releases by the company that it’s going to be a fantastic year. I don’t expect this to be a “one off”result and believe that the company is set for long-term sustainable growth. If you look at presentations from the company they aren’t reliant on anyone industry and so the current downtrend in housing is not going to be huge.

Apart from the juicy dividend, I firmly believe that it is ripe for a take over which is why it’s my largest position on the NZX.

Can't see a takeover myself due to NZ Steel's 20% blocking stake.

Not something of consequence however as far as I am concerned - prefer STU to be listed and keep paying ever bigger dividends into the future.

The bounce back in the sp yesterday is indicative of how STU is now viewed in the market - a turnaround story gathering pace.

[Shareguy]

Can't see a takeover myself due to NZ Steel's 20% blocking stake.

Not something of consequence however as far as I am concerned - prefer STU to be listed and keep paying ever bigger dividends into the future.

The bounce back in the sp yesterday is indicative of how STU is now viewed in the market - a turnaround story gathering pace.

Would be a great fit for Vulcan Steel who don’t currently have a roofing division or the profitable fastening division.

[SailorRob]

Would be a great fit for Vulcan Steel who don’t currently have a roofing division or the profitable fastening division.

Why would any of you pine for the sale of a wonderful business. The thought should make you feel sick.

Unless you don't believe in the business or the sale price is extremely high.

[Snow Leopard]

Share price up and down like a gooseberry in a lift !

[SailorRob]

I must thank Shareguy for getting me out at $1.58 and $1.52. This thread was getting like a *hitcoin thread, animal spirits out in full force.

I will wait for the signal to repurchase!

[Poet]

Can't see a takeover myself due to NZ Steel's 20% blocking stake.

Not something of consequence however as far as I am concerned - prefer STU to be listed and keep paying ever bigger dividends into the future.

The bounce back in the sp yesterday is indicative of how STU is now viewed in the market - a turnaround story gathering pace.

I believe that NZ Steel only has approximately 15% shareholding. A takeover is not impossible, but for my money, a strong recovery and strong dividend growth would be preferable

[Shareguy]

I must thank Shareguy for getting me out at $1.58 and $1.52. This thread was getting like a *hitcoin thread, animal spirits out in full force.

I will wait for the signal to repurchase!

Glad I was of some help. No doubt you have made plenty of rubles from the proceeds.

[see weed]

Why would any of you pine for the sale of a wonderful business. The thought should make you feel sick.

Unless you don't believe in the business or the sale price is extremely high.
I agree with you. We just sold Z to the Aussies for $3.... now I have to pay $40... to Ampol to be able to have a share with Z.:confused:

[SailorRob]

Glad I was of some help. No doubt you have made plenty of rubles from the proceeds.

I imagine you will continue to be.

As I have explained multiple times, fair value is around $1.50.

What disturbs me is the hype created that leads people to follow as $3 was guaranteed. I resisted the urge to ask if Ryman and SUM are as attractive in your opinion as STU at 1.60 on the retirement thread.

Yes thank you, the Rouble is by far the strongest currency in the world of late and much stronger than when I bought. Sberbank position due to Rouble strength is down around 10% and as you'll understand, this is extremely advantageous to me in the long term.

Would be very interested in a bet with you Sberbank vs STU over the next 5 years.

I'm sitting at a 40% differential to the market YTD, around 20% up. This is due to a high exposure to energy, particularly Occidental Petroleum warrants which I purchased sub $3.

Lot of good luck but I'll take it.

[SailorRob]

I agree with you. We just sold Z to the Aussies for $3.... now I have to pay $40... to Ampol to be able to have a share with Z.:confused:

Yeah what a **** show. I bet there were some dodgy things going on there... Z were the ones pushing so hard to shutdown the Refinery.

[Shareguy]

I imagine you will continue to be.

As I have explained multiple times, fair value is around $1.50.

What disturbs me is the hype created that leads people to follow as $3 was guaranteed. I resisted the urge to ask if Ryman and SUM are as attractive in your opinion as STU at 1.60 on the retirement thread.

Yes thank you, the Rouble is by far the strongest currency in the world of late and much stronger than when I bought. Sberbank position due to Rouble strength is down around 10% and as you'll understand, this is extremely advantageous to me in the long term.

Would be very interested in a bet with you Sberbank vs STU over the next 5 years.

I'm sitting at a 40% differential to the market YTD, around 20% up. This is due to a high exposure to energy, particularly Occidental Petroleum warrants which I purchased sub $3.

Lot of good luck but I'll take it.

Gosh, your post comes across as “your opinion is right and mine is wrong”. You might well be right.

As far as hype gos I genuinely believe that the stock is way undervalued not only from the research that I’ve done but from the years of experience in the steel industry. Nothing is guaranteed as most people would know. The share price was looking good for a while until the market turned for most stocks. I’ve had several people contact me who were very happy buying Stu around the $1.00 mark at the time.

As I have stated on here I have a large position and feel the company is doing well. Time will tell where the share price ends up. For me I am very happy holding and waiting.

Well done on your Russian bank and congrats on your performance to date . There is not many long term investors that are up this year so credit to you.

[Shepherd]

I suspect many investors have been wary of the cyclic nature of STU and its past history of poor management. Perhaps some are concerned that we might be heading for a recession that could hit the building industry. STU seems to be under much better management now, but investors often have a long memory. I hope they do well as I have a reasonably sized position in the company.

[SailorRob]

Gosh, your post comes across as “your opinion is right and mine is wrong”. You might well be right.

As far as hype gos I genuinely believe that the stock is way undervalued not only from the research that I’ve done but from the years of experience in the steel industry. Nothing is guaranteed as most people would know. The share price was looking good for a while until the market turned for most stocks. I’ve had several people contact me who were very happy buying Stu around the $1.00 mark at the time.

As I have stated on here I have a large position and feel the company is doing well. Time will tell where the share price ends up. For me I am very happy holding and waiting.

Well done on your Russian bank and congrats on your performance to date . There is not many long term investors that are up this year so credit to you.



Fair points, I was just worried that you seemed to be posting that $3 was almost a sure thing and others would follow due to your industry experience. I have no idea what the potential is but I have an idea based on a long series of past data that $1.50 is all that can be banked on with certainty. Anything better requires better performance in the future than past data suggests and of course this is possible, and likely in the short term. However it would take a bit to convince me that a true step change in ROE could occur.

Yes STU has been clobbered pretty much along with the market, however I strongly believe that you have it wrong when you say 'the stock was looking good'. No, it was looking BAD. Now it's looking good. Lower prices good higher prices bad. Let's hope it continues to improve (get cheaper) while the business continues to spit out more cash.

At one stage recently it was trading at a price where there would be a few people on share trader who could have single handed bought 10% of the company and demanded a board seat. Not now. Being able to buy 10% is GOOD. Not being able to is BAD.

No credit due for my performance YTD, it's just total luck that I was/am long energy and actually pretty reckless to have such a large position. I was about to trim back when Buffett bought 15% of Occidental so just held on. Russian bank blew up in my face but long term will be fine, again total luck that Rouble strength saved me, and indeed it's not a real market at the moment, god knows where it all trades if restrictions removed.

[SailorRob]

I suspect many investors have been wary of the cyclic nature of STU and its past history of poor management. Perhaps some are concerned that we might be heading for a recession that could hit the building industry. STU seems to be under much better management now, but investors often have a long memory. I hope they do well as I have a reasonably sized position in the company.


Well said, yep.

[percy]

I suspect many investors have been wary of the cyclic nature of STU and its past history of poor management. Perhaps some are concerned that we might be heading for a recession that could hit the building industry. STU seems to be under much better management now, but investors often have a long memory. I hope they do well as I have a reasonably sized position in the company.

Investors with a very long memory will recall under Nick Calavrias's direction STU was an excellent performer,year in,year out.
With them recapitalised,right sized,focused, a healthy balance sheet, and well thought out growth opportunities, I think they will yet again be an excellent performer.
Directors/management appear competent,with a strong customer focus .

[percy]

ChCh consents remain at all time highs.Expect it is the same through out the country.
Good for STU.
https://sendy.tarawera.co.nz/l/J6oLVth2f3f6IXNYvUBQEg/zOtur6rxt7CGZ27Ijh6wVw/wsEwBdD5WgApsKhMZyT47A

[sb9]

Bid side depth looking lot healthier than its been over past few weeks. Either the pesky seller finished with their lot or more buyer interest leading upto FY results.

[percy]

Bid side depth looking lot healthier than its been over past few weeks. Either the pesky seller finished with their lot or more buyer interest leading upto FY results.

Looking strong today.[thank goodness]

[sb9]

Looking strong today.[thank goodness]

May run upto 1.50s range in time for FY results next month.

[see weed]

ChCh consents remain at all time highs.Expect it is the same through out the country.
Good for STU.
https://sendy.tarawera.co.nz/l/J6oLVth2f3f6IXNYvUBQEg/zOtur6rxt7CGZ27Ijh6wVw/wsEwBdD5WgApsKhMZyT47A
When I was in town (Auckland) all I can see are cranes everywhere and heaps of construction and in the suburbs even more everywhere building building building everywhere. I'm taking a punt and have been accumulating STU for the last few months. If STU happens to raise the div from 3.29c to 5.5c like last time, the yld will be around about 8.5%. Looking forward to next results.

[percy]

When I was in town (Auckland) all I can see are cranes everywhere and heaps of construction and in the suburbs even more everywhere building building building everywhere. I'm taking a punt and have been accumulating STU for the last few months. If STU happens to raise the div from 3.29c to 5.5c like last time, the yld will be around about 8.5%. Looking forward to next results.

Thanks for your observations.
Our eyes do not lie.
Next result should be well worth waiting for.

[see weed]

Thanks for your observations.
Our eyes do not lie.
Next result should be well worth waiting for.
Next results on 22/8/22. Last year they put out a positive trading update on 21/7/21. Just waiting to see if they put out another positive update some time this month or upping the div to 5.5c in the 22 Aug. results.

[Poet]

Div should be more like 8 or 8.5c

[see weed]

Div should be more like 8 or 8.5c
I would be over the moon if they declared a 8.5c div. for Sept. and the sp shot up to $2:t_up:

[SailorRob]

I would be over the moon if they declared a 8.5c div. for Sept. and the sp shot up to $2:t_up:

You wouldn't be happier if they declared 8.5c and then the share price dropped?

[winner69]

Vulcan buying Urlich

Apply the same ebitda multiple to STU and you get $1.27

sorry about the 2 bucks I mentioned earlier

[kiora]

Good on Vulcan
Oh but how the building industry is creaming it on those margins

[see weed]

STU results next Monday 22 August. There appears to be plenty of building going on around town and wondering if a slightly higher div will be paid from last Septembers 3.29c div. have taken a punt on this one and have topped up with extra 100k shares Roll on Monday see what happens:confused:

[percy]

STU results next Monday 22 August. There appears to be plenty of building going on around town and wondering if a slightly higher div will be paid from last Septembers 3.29c div. have taken a punt on this one and have topped up with extra 100k shares Roll on Monday see what happens:confused:

Wondered who had been pushing the share price up...lol.
Divie may be up,but it is their out look that I am looking forward to.

[winner69]

NZ Steel EBIT Year June 22 was $229m - UP 76% on prior year

Huge 2nd half - Robust demand across construction and infrastructure sectors - things look good into FY23

Maybe those comments yesterday from Bluescope got STU punters excited

Plenty of money in steel says Bluescope

[see weed]

Wondered who had been pushing the share price up...lol.
Divie may be up,but it is their out look that I am looking forward to.
No no not me. The last lot of STU shares I bought was on 15/7/22. Someone else is having a little nibble.

[winner69]

Share price could even get back to 170 soon .... was there early in the year so not new ground

FBU report and comments might be a sign of hat's to come with STU results

[winner69]

Fletcher aying steel business up 40 percent on last year.

Looking very good for a stunner from STU.

Thanks shareguy

[sb9]

Last trading day before big reveal on Monday how good FY22 numbers were and more importantly how big of a payout to s/holders.

[Poet]

Last trading day before big reveal on Monday how good FY22 numbers were and more importantly how big of a payout to s/holders.

I'm expecting NPAT of around $30m which seems to have been well signalled

Their stated dividend policy is 60-80% of NPAT so on 166 m issued shares that implies a dividend of between 10.8 and 14.4 cps (or FY div of between 5.3 and 8.9 cps with midpoint of 7.1 cps)

At the higher end of 14.4 cps it would be trading on a gross dividend of 10% and a recent history of strong dividend growth

What does this imply for share price?

[winner69]

I'm expecting NPAT of around $30m which seems to have been well signalled

Their stated dividend policy is 60-80% of NPAT so on 166 m issued shares that implies a dividend of between 10.8 and 14.4 cps (or FY div of between 5.3 and 8.9 cps with midpoint of 7.1 cps)

At the higher end of 14.4 cps it would be trading on a gross dividend of 10% and a recent history of strong dividend growth

What does this imply for share price?

Gross divie of 14.4 cents - could be higher if they find some imputation credits

Jeez punters might be happy with 7% yield .... and drive share price to $2 or more

Can't seem to go wrong at current prices

[Sideshow Bob]

Steel & Tube FY22 Results Announcement - NZX, New Zealand’s Exchange (https://www.nzx.com/announcements/397310)

RECORD RESULTS AND DOUBLING OF PROFIT FOR STEEL & TUBE
• Record results with revenue of $599.1m, strong uplift in gross margin and net profit after tax almost doubling to $30.2m.
• Earnings momentum driven by a focus on customer service, trading disciplines, operational excellence, supply chain management and positive market conditions.
• Final, partially imputed, dividend of 7.5 cents per share (50% imputed), taking total dividends to 13.0 cents per share, equating to a gross yield of 11.4% (*1).
• Strategic focus on strengthening the core and growing high value products, services and segments.
• Well positioned to deliver through the economic cycle while continuing to invest in growth and deliver sustainable double-digit ROFE.

$m / FY22 / FY21 (*2) / Variance %
Revenue / $599.1 / $481.0 / 24.6%
Volume (Ktonnes) / 167 / 158 / 5.7%
EBITDA / $66.6 / $38.6 / 72.5%
Normalised EBITDA (*3) / $66.9 / $37.6 / 77.9%
EBIT / $47.6 / $20.7 / 130.0%
Normalised EBIT (*3) / $47.9 / $19.7 / $143.1%
NPAT / $30.2 / $15.4 / 96.4%
EPS / 18.3 cps / 9.3 cps / 96.8%
Dividend / 13.0 cps / 4.5 cps / 188.9%

Steel & Tube Holdings Limited (NZX: STU) has reported record results for the 12 months ended 30 June 2022 (FY22), with profit almost double that of the prior year, as the company moves its focus to growth.

Chief Executive Officer, Mark Malpass, said: “Our priority is to make it easy for our customers to transact with us and I would like to acknowledge our people, who have done an outstanding job of doing just that. Despite the volatile steel pricing environment, rising costs and continuing supply chain disruption, we have been able to source, supply and deliver products to our customers in a timely manner.

“We are seeing the benefits of our focus on operational excellence and supply chain management which has allowed us to control costs and deliver improved performance in a more challenging environment. A continued investment in digital technology is delivering improved customer service and efficiency. We will continue to build on our core strengths and are excited about the growth opportunities we are investing in”.

FY22 revenue was $599.1m, up 24.6% on prior year, with volumes increasing by 5.7% to 167 ktonnes. Earnings increased significantly with EBITDA of $66.6m, up 72.5% year on year and normalised EBITDA up 77.9% to $66.9m. EBIT increased by 130.0% year on year to $47.6m, with normalised EBIT up 143.1% to $47.9m. Net profit after tax (NPAT) was almost double that of the prior year, up 96.4% to $30.2m (FY21: $15.4m).

The Board is pleased to have declared a final dividend of 7.5 cents per share. This takes full year dividends to 13.0 cents per share, representing 71% of Adjusted NPAT and equating to a gross yield of 11.4%. This is in line with Steel & Tube’s policy to pay out 60% - 80% of Adjusted NPAT to shareholders.

The company has utilised its strong cash position to invest in critical inventory, providing a key competitive advantage in an environment of supply chain difficulties.

Outlook

While global and local economies traverse an inflationary environment, there will still be strong demand for steel. Pricing is expected to remain at current elevated levels for the balance of the calendar year. As shipping and supply chain congestion eases, inventory cover levels are expected to reduce.

Mark Malpass said: "Steel & Tube’s journey has taken us from a relentless focus on cost and operational discipline under Project Strive, to now having the foundation and ability to focus on growth and building a more diversified, resilient business. Our two primary strategic pathways are continuing to strengthen our core and investing in high value products, services and sectors to drive gross margin improvement.

“One such opportunity is in added value plate processing where we have invested into new equipment to expand our plate processing capability and offer. Another example is our Fasteners NZ purchase in July 2021, a niche operator that has performed extremely well in FY22. More recently, on 1 August we acquired Kiwi Pipe and Fittings, in line with our strategy to invest in high value sectors, and which provides us with scale and market share growth in the fire and water reticulation sector. This acquisition was immediately earnings positive and expected to add over 0.5 cents to earnings per share in FY23.”

Chair, Susan Paterson, said: “Steel & Tube has been in business for almost seven decades and we have successfully navigated numerous economic cycles. The company is well positioned to respond to the changing environment and to take advantage of new market and product opportunities. Data and technology are truly delivering for our customers. Steel, with its infinite recyclability, is a key enabler of decarbonisation, we are proud to play our part in meeting this challenge for New Zealand. We have a great team of committed employees and a strong pipeline of secured work in place.”

The company is hosting an analyst and investor call at NZST 10am today (22 August 2022). Call details can be viewed here https://www.nzx.com/announcements/395195.

*1 Based on share price of $1.27 as at 30 June 2022

*2 FY21 results have been restated for the impact of a change in accounting policy in regards to the accounting for Software as a Service arrangements (“SaaS”).

*3 FY22 and FY21 Normalised EBITDA and Normalised EBIT have been adjusted to exclude non-trading adjustments. Further details included in appendix of our Investor Presentation.

[percy]

Excellent result with strong out look.
I expect the high stock holding to reduce once worldwide logistics normalize.

[RTM]

Excellent result with strong out look.
I expect the high stock holding to reduce once worldwide logistics normalize.

Yes. YES and YES
Now the second biggest contributor to our dividend income, > 17% on our Cost price.
Really nice way to start the week.
Happy days.

[sb9]

Yes. YES and YES
Now the second biggest contributor to our dividend income, > 17% on our Cost price.
Really nice way to start the week.
Happy days.

Agree 100%, turning out to be nice income stock. Very pleasing...

[percy]

Yes. YES and YES
Now the second biggest contributor to our dividend income, > 17% on our Cost price.
Really nice way to start the week.
Happy days.

Expect our HGH Jeff will come up with the goods tomorrow.

[RTM]

Expect our HGH Jeff will come up with the goods tomorrow.

He's going to struggle with the 17% tho.....although I hope not.

[sb9]

Expect our HGH Jeff will come up with the goods tomorrow.

That's true, another income stock to be in everyone's portfolio.

[see weed]

I am happy with the results and my little punt on this company. It wouldn't surprise me if sp gained a couple of cents today. Over doubling of div from last August;)

[BlackPeter]

Record result and solid outlook (even if I would expect both revenue and earnings to somewhat drop from here, but always open to pleasant surprises).

RoE of 14.4 % - not bad, particularly considering where they did come from ... and balance sheet (despite a bit more debt) still looking very healthy (with equity / assets of 48.4%);

PEG still below 1 ... one of the Zulu companies or a cyclical on the way up? Well, lets not get too excited - I suppose its the latter.

Don't remind me, though how much FBU was prepared to pay for them some years ago (rejected from the STU board) ...

[RTM]

SP up ~ 5%. I thought it might have jumped a little more given the dividend yield.
People obviously concerned, correctly, about what the future holds.

RTM

[sb9]

Someone happy to pay bit more than last traded price:



153
500,000
15:14
SP








153
74,230
14:59
SP

[RTM]

Someone happy to pay bit more than last traded price:



153
500,000
15:14
SP








153
74,230
14:59
SP



Thanks...seems to make sense. If they weren't > 5% of our portfolio I would be considering the same....well, not quite those quantities.
Of course with a buyer...there is also a seller.
I am wondering if with less money sloshing around in the system....that there is not ready cash to take advantage of a good result. Meaning that many buyers might have to sell something before they buy something else. Or are less inclined to increase mortgage to buy stocks.

[winner69]

Didn't seem that long ago everybody was excited about STU having $27m cash and no debt

Now they have a few million in cash and $51m debt

Suppose its better having a huge stock pile of steel instead of coin in the bank

Hope it turns into cash reasonably quickly

[nztx]

Didn't seem that long ago everybody was excited about STU having $27m cash and no debt

Now they have a few million in cash and $51m debt

Suppose its better having a huge stock pile of steel instead of coin in the bank

Hope it turns into cash reasonably quickly


Even better, a fair portion of the stockpile is covered by committed orders
and what is in stock is being monitored and checked frequently ..

This was where STU came to grief earlier in the peace on carrying lines requiring impairment

With a possible domestic downturn which could happen too, ability to reduce inventory
with minimal collateral damage is as important as maintaining coverage of stock going forward

How much of the current period's surplus is windfall gains ?

[bull....]

SP up ~ 5%. I thought it might have jumped a little more given the dividend yield.
People obviously concerned, correctly, about what the future holds.

RTM

its after the next 12mths there's the uncertainty for these companies.

[RTM]

its after the next 12mths there's the uncertainty for these companies.

Yep, that as well...and that applies to a big range of companies.

[sb9]

SSH Notice - Lennon Holdings owned by Philip Lennon. Paid an av price of $1.44 piece for on market purchases, not sure about off market ones though.

[winner69]

SSH Notice - Lennon Holdings owned by Philip Lennon. Paid an av price of $1.44 piece for on market purchases, not sure about off market ones though.

Interesting character is Lennon

[percy]

Interesting character is Lennon

Known in bowling circles.?

[RTM]

Known in bowling circles.?

There’s a nice memorial in New York…..

[SailorRob]

Record result and solid outlook (even if I would expect both revenue and earnings to somewhat drop from here, but always open to pleasant surprises).

RoE of 14.4 % - not bad, particularly considering where they did come from ... and balance sheet (despite a bit more debt) still looking very healthy (with equity / assets of 48.4%);

PEG still below 1 ... one of the Zulu companies or a cyclical on the way up? Well, lets not get too excited - I suppose its the latter.

Don't remind me, though how much FBU was prepared to pay for them some years ago (rejected from the STU board) ...

Imagine what they could get the ROE up to if the do another massive write down.

[waikare]

There’s a nice memorial in New York…..

Imagine that

[Balance]

SSH Notice - Lennon Holdings owned by Philip Lennon. Paid an av price of $1.44 piece for on market purchases, not sure about off market ones though.

Great to see someone with a few hundred million dollars mopping up some of the loose shares in the market.

Hard to beat the yield!

[Dassets]

Didn't seem that long ago everybody was excited about STU having $27m cash and no debt

Now they have a few million in cash and $51m debt

Suppose its better having a huge stock pile of steel instead of coin in the bank

Hope it turns into cash reasonably quickly

Hi winner, true at the time because it represented value to shareholders when the stock was at much lower prices. But times change and it is more important to look at how it has been used today. The cash has been used to support a higher level of "unit" inventory, I make this point because inventory in a high inflation environment $cost is going to rise. While STU doesn't give us tonnage figure(could be useless without a bucket of inventory type to give it context) it makes a clear comment on how inventory has changed and how it is being managed. And I see higher inventory volumes in a net higher margin stock(higher margin for the capital either due to stock turn or pure product margin).

What I was worried about was the FCF was going to get eaten up by higher inventory(lazy use of capital by mgmt) but I am very happy that they have used debt(both core and trade facility) to do the heavy lifting. I was worried because I thought dividend may have been (in part) the sacrificial lamb. But I am very happy that the dividend policy was properly applied and we saw 71% payout ratio. Combined I like it because it shows clear application intent by board and management in their approach to shareholders.

Two more comments. 1. Price/trading etc. The absence of institution holders weighs on that. The retail holders are pretty saturated(ask a Tesla holder where the next stock buyer is coming from). But I think the smaller institutional holders must start reviewing this stock. Keep a look out for crossings(like the 500T yesterday) to show possible insto buying. 2. Inflation and inventory coming down as inflation wanes. I do not either is going to happen in the way some think. Inflation is not been driven by demand, it is all(almost) supply driven. I do not think it is purely COVID related but a stronger macro theme. I wrote an article I published last Nov on Linkedin. My article was supported by strong academic research published in the Journal of Economics Oxford and was focused on the 1700s(believe it or not) and industrial revolution - the introduction of commercial steam engines. Any one wants to read it PM me and I will tell you who I am if you do not know. That work would suggest a multi-decade higher inflation environment. All I have seen since supports my view.

[percy]

I am expecting the stock level will reduce as worldwide logistics improve.

[bull....]

this interesting from vulcan release today

Rising interest rates and ongoing COVID-19 disruptions in some major markets are likely totemper global economic activity and demand for steel and metal products.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/VSL/397489/377281.pdf

[winner69]

See STU got caught out exaggerating a bit in their announcements ---- 'quadrupled' was actually 'more than doubled'

And if they went back to the old annual reports they would have noticed that F22 profits weren't a 'record' - NPAT was slightly higher in 2006

[BlackPeter]

See STU got caught out exaggerating a bit in their announcements ---- 'quadrupled' was actually 'more than doubled'

And if they went back to the old annual reports they would have noticed that F22 profits weren't a 'record' - NPAT was slightly higher in 2006

Come on - 2006 nearly 2 decades ago! Not just world best in NZ but best result in 16 years .... Hey, this is more then even the amazing All Blacks can claim :): Must be a record, then ...

[SailorRob]

Hi winner, true at the time because it represented value to shareholders when the stock was at much lower prices. But times change and it is more important to look at how it has been used today. The cash has been used to support a higher level of "unit" inventory, I make this point because inventory in a high inflation environment $cost is going to rise. While STU doesn't give us tonnage figure(could be useless without a bucket of inventory type to give it context) it makes a clear comment on how inventory has changed and how it is being managed. And I see higher inventory volumes in a net higher margin stock(higher margin for the capital either due to stock turn or pure product margin).

What I was worried about was the FCF was going to get eaten up by higher inventory(lazy use of capital by mgmt) but I am very happy that they have used debt(both core and trade facility) to do the heavy lifting. I was worried because I thought dividend may have been (in part) the sacrificial lamb. But I am very happy that the dividend policy was properly applied and we saw 71% payout ratio. Combined I like it because it shows clear application intent by board and management in their approach to shareholders.

Two more comments. 1. Price/trading etc. The absence of institution holders weighs on that. The retail holders are pretty saturated(ask a Tesla holder where the next stock buyer is coming from). But I think the smaller institutional holders must start reviewing this stock. Keep a look out for crossings(like the 500T yesterday) to show possible insto buying. 2. Inflation and inventory coming down as inflation wanes. I do not either is going to happen in the way some think. Inflation is not been driven by demand, it is all(almost) supply driven. I do not think it is purely COVID related but a stronger macro theme. I wrote an article I published last Nov on Linkedin. My article was supported by strong academic research published in the Journal of Economics Oxford and was focused on the 1700s(believe it or not) and industrial revolution - the introduction of commercial steam engines. Any one wants to read it PM me and I will tell you who I am if you do not know. That work would suggest a multi-decade higher inflation environment. All I have seen since supports my view.

You'll make a lot of money betting against the bond market if you're right. Wonder how the strong academics have performed investing using their theories in the actual markets.

I imagine the steam engine did a fair bit for supply.

[see weed]

13 div. and they saying 11.4% yld, I was thinking more like 8.5% yld. Might have to call STU the Sleeping Beauty. Some handsome Knight might give the steel lady a kiss and wake her up and see sp raise above $1.60. Philip Lennon gave the lady a wee peck on the cheek, but still she sleeps, but with a smile on her face. From such good results.

[ithaka]

13 div. and they saying 11.4% yld, I was thinking more like 8.5% yld.
*1 Based on share price of $1.27 as at 30 June 2022

[Snow Leopard]

See STU got caught out exaggerating a bit in their announcements ---- 'quadrupled' was actually 'more than doubled'

And if they went back to the old annual reports they would have noticed that F22 profits weren't a 'record' - NPAT was slightly higher in 2006

I nearly choked on my chocolate pie* over the frequent references to a company that they did not buy.

*recovering nicely with intravenous drip coffee.

[Dassets]

You'll make a lot of money betting against the bond market if you're right. Wonder how the strong academics have performed investing using their theories in the actual markets.

I imagine the steam engine did a fair bit for supply.

That "academic" was Earl Jefferson Hamilton (1899 – 7 May 1989). An American historian, one of the founders of economic history, PhD from Harvard, a professor at Duke, then Northwestern then Chicago. He was a leading global economist. I tracked his research down when I started suspected something was happening(not COVID) to the supply chain ie a new energy supply chain was being mandated and supercharged in pace of rollout(globally). As an aside the expectation that electricity was going to get cheaper is totally bogus. I was working on assessing then championing a re-power of a wind farm.

BTW the market has been wrong on big things before. But I would rate the magnitude what is happening now at big x $1 MILLION DOLLARS!(Dr Evil-style)

[SailorRob]

Yes of course the market is wrong all the time but trying to make money on any macro predictions is a fools errand let alone speculating on a paradaigm shift in energy imposed by government, not market forces and based around reaserch such as you're talking is crazy. I don't mean to cause offence, just speaking my mind and reality.

[SailorRob]

And nobody really knows the inflation puzzle but try telling the people I know who have all installed new swimming pools, bought new Rangers, extended houses and new caravans plus a massive ammount of other toys in the last 24 Months, that demand hasn't played a big part.

If you distribute 50 million dollars into a suburb of NZ then the local shops will be cleaned out and gas station empty within hours.

[bull....]

more talk of peak result this yr

Building sector welcomes drop in steel prices, hopeful for wider reductionsWade said prices are also starting to come down because steel manufacturers in New Zealand seemed to take advantage of higher global shipping costs - which skyrocketed during the COVID-19 pandemic - to in turn raise their prices. This keeps them on par with imported steel prices, and because people want their products to be made locally, they go with New Zealand-made, he said.
"Even with the high shipping costs, I understand imported steel is now cheaper," Wade told Newshub. "And that happened about a month ago and now the New Zealand companies are starting to follow suit and reduce their prices to be more competitive."

https://www.newshub.co.nz/home/money/2022/08/building-sector-welcomes-drop-in-steel-prices-hopeful-for-wider-reductions.html

[see weed]

When I was in town (Auckland) all I can see are cranes everywhere and heaps of construction and in the suburbs even more everywhere building building building everywhere. I'm taking a punt and have been accumulating STU for the last few months. If STU happens to raise the div from 3.29c to 5.5c like last time, the yld will be around about 8.5%. Looking forward to next results.
From 8/7/22. Very happy with the result and upping the div 2c above what I thought and 4.21c above last years 3.29c div. There is a building boom going on and is forecast to last for at least the next 6 months to get through the backlog. I heard this from Milford Asset Management on TV3 AM Show this morning.

[Dassets]

Yes of course the market is wrong all the time but trying to make money on any macro predictions is a fools errand let alone speculating on a paradaigm shift in energy imposed by government, not market forces and based around reaserch such as you're talking is crazy. I don't mean to cause offence, just speaking my mind and reality.

Funds and especially asset allocators are driven by macro moves all the time so not sure what you mean. It is one of the few research methods adopted in funds management. The early ones to realise that the world was in long term inflation and interest rate move down around the early 1990s made themselves the biggest fund managers in the world, it is arguable that is what supported index funds btw.

I understand what you are saying but I have been seeing it at the coal face which lead me into looking at it more deeply. I went to 3 major conferences in the US in June which truly had heavy hitters either speaking or just in the audience listening. The conversations, especially at the energy transition one(300 CEOs + 400 others), were very active around exactly what I am talking about, in the sessions or sit-downs. This is a big issue in a lot of peoples' minds and those people are the ones trying to deliver the move.

Everyone is entitled to a view as you say. But it is a paradigm shift that has been asked for. Whether it can be delivered at a financial cost acceptable to the public hasn't even been discussed.

[nztx]

Nice little upwards ride .. and The Hawk is out of the coming Stew :)

[SailorRob]

Funds and especially asset allocators are driven by macro moves all the time so not sure what you mean. It is one of the few research methods adopted in funds management. The early ones to realise that the world was in long term inflation and interest rate move down around the early 1990s made themselves the biggest fund managers in the world, it is arguable that is what supported index funds btw.

I understand what you are saying but I have been seeing it at the coal face which lead me into looking at it more deeply. I went to 3 major conferences in the US in June which truly had heavy hitters either speaking or just in the audience listening. The conversations, especially at the energy transition one(300 CEOs + 400 others), were very active around exactly what I am talking about, in the sessions or sit-downs. This is a big issue in a lot of peoples' minds and those people are the ones trying to deliver the move.

Everyone is entitled to a view as you say. But it is a paradigm shift that has been asked for. Whether it can be delivered at a financial cost acceptable to the public hasn't even been discussed.

This is exactly what I'm getting at and this is why hardly any of them can beat the market over any decent time period. As Jake the Muss once said 'too much weights, not enough speed work'... Most of those people at those conferences are just feeding off fees and not from actually providing market beating returns over the long term. None of them can predict future rates of inflation or interest rates.


The only person who has asked for any paradigm shift that I know of is Greta. Europe is slowly learning that leaving energy policy up to a 16 year old with severe mental disabilities driven by multimillionaire promoters/parents is not clever.


C02 has gone from 3 molecules per 10,000 to 4. Better for everything Green.

[Sideshow Bob]

NZX Virtual Investor Event - 6 September 2022 (mailchi.mp) (https://mailchi.mp/nzx.com/virtual-investor-event-sept-351712?e=baeeaaa251)

Mark Malpass & Richard Smyth on the next webinar 6th of September.

[see weed]

NZX Virtual Investor Event - 6 September 2022 (mailchi.mp) (https://mailchi.mp/nzx.com/virtual-investor-event-sept-351712?e=baeeaaa251)

Mark Malpass & Richard Smyth on the next webinar 6th of September.
Thank you SB for that reminder for the Investor Event on 6/9/22. Will be very interesting to hear what they are saying. STU doing very well lately and upping their dividend.....wait for it, drums rolling.....by 289% from last year from 4.5c to 13c this year. Two days after that investor event STU goes ex div on 8/9/22. Any positive forecast on the 6/9/22 could see a little lift in sp before the 8/9/22. I am very happy with my holding gaining over 24k in the last few months and a 9k+ div next week. But I am only a Johny come lately. If you look at the 2 year sp graph, lots of others have done a lot better than me. Go STU, go for gold, come on $1.60 small baby steps and steady as she goes:t_up:

[Balance]

Reminder - STU webinar on today at 11.00am.

https://www.nzx.com/announcements/398298

Meanwhile, a ranking and survey of NZ's largest home builders show a solid development pipeline out a year. STU is less exposed to this sector than say, FBU but still pertinent.

https://www.nzherald.co.nz/business/ranked-new-zealands-biggest-home-builders/TCIWIVJBJJJ5CXPHZ23MWNWO7Q/

"Build cost inflation, materials and labour shortages have taken a bite out of the construction sector, yet New Zealand's top home builders still boast chocka workloads and a forward build pipeline that's out to almost a year. Data from construction research firm Pacifecon showed that of NZ's top 15 residential builders, each had 1,000 home builds on their books at March 31."

[see weed]

I just bought some more at 1.55. Don't mind paying that price at 8.5% yld.