BSA. Broadcast Services Aust Newsflash

[robbo]

bsa.--ASX Code:-- BSA Broadcast Services Australia. .

...BSA...

Personally Rate BSA as Extremely Undervalued on Intrinsic......Fundamentals--and very very Big Short and Medium Term High Potential.

ALP/Libs both to spend $10 Billion plus on Broadband Rollout.

This BSA is a Immediate 3 bagger--imo only-- ready to pop imo....

This is...(not)--repeat-- Not advice--but believe this to be Hot

Kindest Regards,

robbo:)

[BSA]

Hi Robbo,

Been in this one since 32c with its stage one base break so happy thus far.

Cheers
er BSA

[robbo]

Broad Cast Services....BSA.

They are doing CURRENTLY--

--- 40 connections a week-- --130, 000 connections a Month --in Businesses, small, medium and large for:

.....Broad Band Connections....ADSL and ADSL 2 +

Their Main Clients being:-- Telstra, Optus, Austar, Foxtel, Hutchinson and '3' ....

-They are the largest connector of Antennas for Pay Tv and normal TV--via Antennas and satellite Receiver Dishes --for Digital and Pay TV-- in Homes, Hotels, Apartments, Motels and Business's ...bar none-- in Australia.

-They have a Franchise going back twenty Years---in the Name, Logo,Trademark, and huge Marketing Brand Equity of...." Mr.Antennae" and Trademark of same.....

- On a 4 years earnings per year growth (EBIT) -- , for year for year basis they are without peer-- 71 %--Average--year, on year, on year, on year --for 4 consecutive years-- and over-- 700%--that is NOT a misprint--for the last 2 Consecutive years.

-Return on Equity-ROE_ is over 40%--and the consistent standard of ROE--over last 4 years--is also almost without peer in Australia...

-Annualized Profit increased over 180% for the year.... from a solid consistent base.

-No Debt to speak of and Excellent Free Cash flow.... Not risky high leverage on Balance sheet.

- Huge current and future Demand fro VOIP, Cable Television,Antannas and Satttelite dishes, and Digital Set Top Boxes....

-BSA...imo-- Stand to be hit by a Tsunami of Sustained Economic Demand from the Upgrade of Fibre Optic Cable and Internet Carrying and Speed capacity-- in Labor/Liberal Election Promises-- to re vamp to High Speed Broad-Band-- internationally competitive Internet--already announced by Kevin Rudd--ALP--of $10 Billions ++.

-This business have a "heart" and a Strong Strategic-- Direction, and vision--and are ....proven .....to be....very Community Give back to Society--(check out their -BSA- Website)-- minded.

-Murdoch, Packer and Fairfax --Foxtel-- Telstra -Optus-- etc etc-- are also behind & Demanding persistently-- this PUSH--actually are screaming for it--Upgrade of Broadband internet-- so it WILL now happen--and almost immediately in relative terms-- for obvious Self interest Big Media/Big Business commercial reasons--as is Big Business.

Food for thought.:)

BSA is only a minnow now--market cap under $100m--with a excellent Profitable Balance sheet--

Expect this BSA--- to be the next highly--imo-- possible Emitch (EM) or Seek (SEK0--imo-- style share--over next....say .... 3-6-8 months.

Kindest Regards,

robbo. :)

[robbo]

BSA. Broadcast Services Australia . (BSA)

Will we see 0.85 c---by this Thursday or Friday....??...

Well, it really does NOT matter--as one ought to always focus upon the asset--not the day to day share price-- ....as the Sage from Omaha says:

the name of the game is to:

"We have tried occasionally to buy toads at bargain prices with results that have been chronicled in past reports.
Clearly our kisses fell flat.
We have done well with a couple of princes - but they were princes when purchased.
At least our kisses didn't turn them into toads.
And, finally, we have occasionally been quite successful in purchasing fractional interests in easily-identifiable princes at toad-like prices."

Warren Buffett.... at the 1981 Berkshire Shareholder Meeting .

That said-- and I reckon we have now, "a Prince at toad like prices".... with BSA....

however the little guessing game.... is fun, so... with fellow Pub Crownie drinkers; we feel that,re. BSA-- it will imo--- be highly likely to ..."romp it in" ....Especially & probably / possibly better again-- "once the "penny drops"....

Kind Regards,

Robbo:)

[robbo]

Broadcast Services. (BSA).

Okay....have been getting few emails...re.BSA...

So will say it just... one last time .....this clear and explicitly....

imo--this.... BSA.... is one of the Best Share Buy Opportunities-- possibly-- imo only-- that I have assessed in quite a while re. a Share with BOTH-- ...

(a) excellent Financial Fundamentals ....

(b) as well as... excellent Short, Medium and Long term Very High Growth Prospects.....



It would not surprise me for this share (BSA)-- to Double In Price within 30-40 days ....if not sooner.

....There ..re BSA.... I have ...now ....said it.

....Why...I am so positive..re.BSA....?? ?

Because imo only...and not as advice--

Broadcast Services Australia (BSA)-- simply .... passes ....so many Tests....And... imo-- with flying colours.

Just a few ...easy...ticks--& Big Plusses-- that quickly & instantly come to mind include: ....

1. How will this company make money? --Answer--Telstra, Optus, Foxtel, Austar etc...use them to tune of 130, 000 connections a month and this is growing exponentially.

2 Is the consumer clearly defined? Answer: Yes ...Businesses plus Residential...

3 Is the customer involved in defining the product or service? Answer: Yep.

4 How are you going to satisfy the market? 20 years of servicing this market and become Market Leaders Technically and Operationally with National Brands to Support same.

5. Low PEG less than .04
6. Revenue, Profits, EBITA and ROE, year on year on year on year CONSISTENT Growth.

7. Low Market Cap--so the maths for High works

8. ROE increases especially impressive with their consistency.

9.. Utility and marginal utility must be very high and sustainable...and they are in this case.

10. Stable and skin in the game --aligned to shareholders-- ethical Management.

12. Enablement/Reconfigurability- -- Answer-- imo-- Big Time

13. Mutually sustainable competitive advantage between client and organization and aligned High Impact Stakeholders--Telstra, Murdoch, Packer, Optus, Foxtel, interests, Government, Big Media etc..


14. Sustainable competitive advantage with unique selling proposition conceptually mutual

15. Monopolistic Niche Dominator-- tendencies in a global secular sustainable demand.

16. . Best Market Based Position to benefit from Global Demand Systemic large kinetic demand creating and sustaining Forces

17.. Vested power of elites and self interest gravitating towards motivating and endorsing the Industry Specific Niche Sector….

18.. Deep but defined Profitable High sustainable Demand economically huge immediate proven potential niche

19. Chance to become or already are Industry Sector the National benchmark standard.

20. A company that meets a Problem and has the winning solution by removing remove complexity.

21. Superior business model and costs trending down--with Lowest Cost Base .

22. Simple High Free Cash Flow and Easy to Understand Business and Business model to generate predictable excellent growing free Cash flows going immediately forwards...

Anyway....as I say...some interesting....Food for thought...with BSA.

Kindest Regards,

Robbo .:)

[Huang Chung]

Robbo

What is going to drive the share price to 85c by the end of the week [?] ....other than buying by your loyal band of followers :D:D.

[robbo]

quote:Originally posted by Huang Chung

Robbo

What is going to drive the share price ....to 85c by the end of the week [?] ....other than buying by your loyal band of followers :D:D.





....errrrrr......can you read English ...???...Huang Chung....??

Huang Chung, take a look at your self; and what YOU asked me in your post----

I put about 20 reasons and issues pertaining to EXACTLY--what your question asked.....

ie: What ....is going to drive the share price ....etc....

And then go Back to my posts--where I took considerable time, and space to cover Just That exact question....

So the real question is: what was the.... REAL point ....of what you wrote.....and even more incisively--WHY--you chose to write it that way....???.... Huang Chung...?

Huang Chung, go recently to the DXL post--there today some share traders took good issue with some of my arguments--and I respect that--good issues, good questions--and I answered them accordingly....

But a bland silly sausage statement like that is beyond the pale.

Regards,

Robbo:)

[robbo]

quote:Originally posted by absolut-advance

Alot of people agree with you Robbo ... hence the high P/E

nice low PEG and tiny Market Cap for the type and size of business.

AA
.

Good points AA.

The PE you quote-- is not a forward earnings PE--but a historical one....of course is a historical....PE-- my argument is about what is happening now-- immediate going Forward..>>>---

hence as you rightly point AA, out the PEG--which is Price Earnings ratio to ...>>>> earnings "Growth"--<<< (PEG)-- the whole central point ......of what I am saying here....

And also the PE for BSA-- is about PE historical of PE: 21-23 range--about what emitch (EMI) --or now Mitchell (MCU)-- was at 24 cents or so.....(it is now around 1.43 18 months later.

Again--if the market agrees more down the track-- the Historical PE could be like Emitch--and be at PE for emitch/mitchell now at PE:63!!

Such is life with Rare Gem--High Competitive Advantage Monopoly like smaller cap-- Growth Stocks !!

Also the Funds will love BSA--Growing Fully franked Dividends, 5 years of earnings/npat history--IN the Sweet Spot--see previous BSA posts-- ...yep--imo-- BSA-- overall ticks all the right boxes for the Funds....

Watch this BSA go swiftly to $2.25 ...before this Christmas ...imo.

Regards,

Robbo:)

[Huang Chung]

No offence meant Robbo, but I don't necessarily see a correlation between the numerous good points you mention, with a share price some 40% higher than where it is now by the end of the week....and yes, I realise that you made your reference to 85c as a question, not as a prediction.

All the best. H.C.

[donnie]

Its good to see BSA starting to rise since my first post on this tread in 2004 its taken a while to rise.It goes to show a dog can rise back from the dead.

http://www.sharetrader.co.nz/topic.asp?TOPIC_ID=20419&SearchTerms=bsa

[rev]

( Sorry to tweak the line slighty off topic..[:I]..I'd be interested in ITE related stuff if there's anything new.)

Cheers.:)

[Flying Goat]

Yep looks interesting, nice clean balance sheet and impressive earnings growth. At a glance however the fact that one Director sold >300,000 shares at market last week makes it hard for me to get too excited about the company's immediate prospects.

FG

[robbo]

Hi Flying Goat,

Can read you like an so....'obvious' book....;)

regards,

robbo :)

[Flying Goat]

quote:Originally posted by davidrob

Hi Flying Goat,

Can read you like an so....'obvious' book....;)

regards,

robbo :)


Robbo, Hi,

No idea what you're on about with that comment, but good luck!

FG

[robbo]

BSA.

NO worries BSA.... :)

Just being whimsical--btw--the director (Acting Chairman)-- to whom you refer sold only a fraction of his holding--and has still got over-- over 3, 151, 000 ordinary shares in BSA

Kindest Regards,

Robbo :)

[ONTHENOSE]

mmm.. Looking good.... The Fundamentals of a winner are there....[8D]:D

Once again looks like you have spent alot of time researching this one Robbo.....;)

(May need to off load a few ITE to get on board...decisions decisions)[:I]

mike

[robbo]

Do ....NOT ....not....want to talk about the Content on the Public Forum AA-- but I trust you got my emails--???-- and especially the second one--??-- in response to your querries...etc...

regards,

robbo.

---------------------------------------------------------------

-----------------------------------------------------------------------


quote:Originally posted by absolut-advance

Clearly ... This statement and the relevance of ... is the most important factor to me before even considering a investment in BSA ......... :Labor Election Promises to re vamp to High Speed BroadBand already announced by Kevin Rudd--ALP--of $10 Billion dollars.

As this is the big driver of....

BSA given the position of the company

So my Questions might be:

Is this a sure thing can you trust politician promises

When? These things usually drag out....

and how much of this 10 billion could BSA get there hands on? and by when?

Any attemps at guessing/answering these questons?

AA

[robbo]

Broadcasst Services Australia. (BSA).

One of you more quieter quys--(mamos) !! ....has very kindly mentioned(via email)-- that BSA has a excellent 30 minute Presentation by their Managing Director-- Mr Mark Foley--on Boardroomradio.com

This was on about the date of 29 March....2007.

You need to look under Broadcast Services Australia not--BSA...to find it there and have a ....Listen....

Excellent Verbal detailed Summary-- of the present and immediate future prospects--for BSA-- from the horses mouth so to speak...

Interestingly --on Boardroomradio.com...Mr Foley....they flags Internet Protocol--via Telstra--via s strong steady surge in regular VOIP connection's --business's especially--- as another Higher Margin Growth area for Revenues---alongside the Broadband and Foxtel roll out

Telstra-- says BSA's MD--Mark Foley-- --are switching to Internet Protocol--as their Core Voice Protocol--so not only Higher Margins--but also unlimited Revenue Growth prospects...and immediate and happening as we speak.....

If you are interested--do have a little listen....

Kind Regards,

Robbo:)

[robbo]

Hi to everyone on Anzaac Day,

Thought I would let you know…that I am taking a one (1) month approx—or so….Rest and Sabbatical—from Share-trader—and any other Forums—for personal reasons.

To KW--most of what you say is not the fact--Downer have 40 % and BSA the other--and what you say in particularly about Telstra and BSA is also incorrect on a substantive --I have researched this in detail--basis.

however KW--a good post-- do definitely respect your right of response-- and your opinions are worthwhile--....


Still feel that these shares are excellent….in particular BSA imo is very undervalued—on A Value Investing basis…. But of course that is my assessment and view only—and Not meant as advice.

All the best to everyone—

till I get back….and hope you all have a…. reflective and meaningful …. Anzaac Day -- …

Kindest Regards,

Robbo.

[robbo]

quote:Originally posted by davidrob

Hi to everyone on Anzaac Day,

Thought I would let you know…that I am taking a one (1) month approx—or so….Rest and Sabbatical—from Share-trader—and any other Forums—for personal reasons.

To KW--most of what you say is not the fact--Downer have 40 % and BSA the other--and what you say in particularly about Telstra and BSA is also incorrect on a substantive --I have researched this in detail--basis.-

-Listen to the boardroom.com 29 March--to hear from Mr Foley about the now in place BSA and Telstra Contracts--and BSA having that recently in place after rigorous due diligence by Telstra on BSA.

Again--encourage everyone to listen to that Boardroom.com BSA interview--as it covers some of the points made by KW on this issue and also other substantive issues, about growth trajectory which BSA are currently on...

The FTTN Pay TV installs are currently handled by BSA--not just Sattelite installs.

However KW--let me also say-- KW you make excellent points--and your post was a thoughtful, worthwhile & good post-- and KW-- thanks for that, as I do definitely respect your right of response-- and your opinions are worthwhile--....


Still feel that these shares are excellent….in particular BSA imo is very undervalued—on A Value Investing basis…. But of course that is my assessment and view only—and Not meant as advice.

As I say, am taking a one (1) month approx—or so….Rest and Sabbatical—from Share-trader—and any other Forums—for personal reasons.

All the best to everyone—

till I get back….and hope you all have a…. reflective and meaningful …. Anzaac Day -- …

Kindest Regards,

Robbo.

[robbo]

Broadcast Services Australia.... (BSA)

Thanks for that AA,

Just quickly add this quote from the March--2007 BSA Newsletter --re Foxtel, Telstra and Cable Connections... quoted directly from this BSA Newsletter....(also listen to radio)

on a roll with foxtel
BSA gains FOXTEL cable contract One of BSA’s longest-standing and most
important relationships is the one it has forged with the business Foxtel.

More recently, the company has moved towards helping Foxtel expand its
growing digital subscription television service...... by adding cable installation and...... maintenance services. BSA now manages the largest share of Foxtel’s installation activities.


Leaston Paull, the general manager of BSA’s Foxtel division, said the cabling agreement has become a significant contract for BSA, and one he knew would be crucial in establishing BSA as the leader in domestic installation of
subscription TV, telecommunications and other technical maintenance services.

“Knowing the scope of work it might produce, it was a goal to secure..... the ....Foxtel cabling.... work ......when I arrived at BSA,” said Paull.

“We started tracing a little bit of it through .....Telstra..... in 2004 ....when we did some contract work for them. That was purely overflow work, when
the opportunity arose due to customer demand, ....Telstra.... knew how much work we performed for Foxtel installing satellite services so they were
comfortable coming to us, for cabling work as well....”

The move to make the Foxtel cabling agreement more permanent began some time ago when conversations started taking place about transferring the management of those works
.
******* They clearly wanted to streamline the number of suppliers being used.

Foxtel spent the better part of two years trying to put in place two (2) solid suppliers for all their activities - cable and satellite - with BSA, by
virtue of its past history in service excellence, being an obvious choice.

BSA spent considerable time working with Foxtel looking at the installation of ..... cable,..... how it runs, how it works, and how working under
an agreement with BSA would best work.

With the nuts and bolts of the new service contract Now firmly In Place, BSA set about getting the job of servicing Foxtel’s new and existing base of
.....cable ....subscription television customers.

“We started putting all that together in October last year (2006) and we rolled out three (3) seperate phases, Paull explains.

“In conjunction with Foxtel, we set ourselves task of rolling out..... the cable installation ....in three stages. So we rolled out the first phase
in October with 18 per cent of the volume of the cable, the second stage was 35 per cent and the remainder happened in December 2006.”

It’s a source of pride for Paull and BSA that it was able to significantly step up its usual rate of .... Cable installations to meet the demands of the
new Foxtel Cable Service contract. The BSA's company’s dedicated management staff, on-site technicians and call-centre employees combined to raise the rate of installation of Cable for Foxtel-- by 30% per week,
a remarkable result.

“It’s a great thing knowing that we have the staff capable of
meeting....>>..... a huge increase in sustained Demand...”

“It was great team effort on everyone’s behalf,” Paull says proudly. “It’s a great thing knowing that we have the staff capable of meeting
a huge increase in demand. And gaining that sort of reputation (with Telstra and Foxtel)-- in the market place is going to provide untold benefits for BSA
moving forward.”

[mamos]

KW and others

I have some questions about BSA's operating space.

1. What proportion of customers opt for a self install instead of a technician coming out for either upgrading to Foxtel digital or Foxtel IQ.

2. I know there is self install for BigPond cable if already have Foxtel cable. But if a fresh installation of foxtel cable is required then will a technician be required?

3. Are technicians required for broadband set-up (turning on at the exchange?).

4. A lot of the current marketing for Foxtel comes with "free" standard installation. Maybe this is what is generating the extra work for BSA.

5. Telstra IP (VOIP) what is this exactly? Does this require technician installation?

6. Why do you think BSA will not play a part in the FTN rollout?

7. Would IPTV run on throught the phone lines (ADSL) or through cable or both? How long do you think until we see IPTV? Will IPTV make cable and the set-top boxes redundant?

8. Why do you think the workload for BSA is increasing from Telstra and Foxtel given the above factors. Greater outsourcing? Both companies have had problems in the past with their own subcontractors.

Cheers,

Mark

[cloggs]

Okay, I'm in. The Boardroom Radio broadcast and presentation were very pesuasive. No debt, contracts with Telstra, Foxtel and that American outfit. All good stuff.

[Jay]

Didn't Robbo say he was taking about a month off.
That was around end of April and therefore he must be due back anytime soon.

Not much said about BSA on a couple of other forums I keep an eye on (- Hotcopper and sharescene)

[lakeys]

foxtel contract just signed $300m+ over 4yrs.

[ohmyme]

Yup looks like FoxTel are phasing out their work with BSA (ie moving towards self installation), you see FoxTel is actually a charity organisation and they have pledged at least $300million to BSA over the next 4 years, because BSA are a nice company.

I cant believe the lack of price action on this company. Oh well back to doing nothing I guess.

cheers

[cloggs]

A good couple of days since that announcement. Up 22% since I got in on 28 May. Outstanding!

[lakeys]

yes iam in too ................ go go go

[ONTHENOSE]

BSA is slowly progressing foward since the Foxtel announcement... Looking good...[8D]



Good to see u back Robbo....;)



Regards

Mike

[Underlord]

Hi Guys AA Robbo

Finally on board today would like to have done so sooner but hey can't have em all:( never mind here now so lets see where it all leads :)

UL

[Underlord]

Hi AA

Yes nice to see....BSA not creating alot of attention just moving up at a nice steady pace :) the higher it goes before the rat pack a sniff the better imo

[cloggs]

That's a good read AA. Thanks for that. Now up to 90.

[mamos]

We should be receiving an update from the company very soon regarding FY07 dividend and potentially profit guidance. This announcement was made last year on July 6th and I believe management were meeting this week to discuss FY results.

[vjp24]

The 3 mil seller at 98c seems to have disappeared for now...could there be an annoucement soon?

[steve fleming]

quote:Originally posted by absolut-advance

BSA has just past the 100 million market cap range the minimum for many fund managers who are often limited by various rules, one being market cap , I have seen this happen time and time again.... after companies like BSA have reached the 100 million MC they explode driven my funds buying into a tight registers like BSA's.



Just on this point AA, i've read how a number of commentators/analysts believe that a growing company with a market cap of between $100m and $500m is in the markets SWEET SPOT.

The combination of increased broker/analyst coverage, fund manager mandates, increased profile and credibility all help in assisting growing companies in this MArket Sweet Spot to be very very rapidly re-rated.

I agree with you that this should soon occur with BSA...who i note receives no analyst coverage at the moment. A decent full year result should change that.

[Underlord]

Although slightly down for BSA today some interesting tradeing in the last hour..more volume today than the last week in total

[steve fleming]

i haven't been watching BSA for as long as others on this thread, but at the moment BSA does well and truely look like it will pop.

- all the weak sellers have been cleared out
- big engineered cross of 600k shares today, indicating somethings up
- almost 20% gap between bid & ask.

Will be interesting to follow next week.

[ONTHENOSE]

Hi Robbo,


Appreciate you bringing ANOTHER great share to my attention. ;)

Got into BSA when thread started @ 61cents.. 31% up atm, cant complain with that....[:p]



regards

mike

[ONTHENOSE]

But --IF--if-- you wanted to buy ... BSA---this arvo-- $50, 000 worth of BSA-- this afternon--what would you now have to pay for BSA -- OnTheNose....?

You would be hoping a few more sellers would appear... If no more sales appeard and wanted... Had to have by market close..... Would have to pay 92 cents upwards.. Quickly taking us above $1.. [:p]

[steve fleming]

quote:Originally posted by ONTHENOSE

Hi Robbo,


Appreciate you bringing ANOTHER great share to my attention. ;)

Got into BSA when thread started @ 61cents.. 31% up atm, cant complain with that....[:p]



regards

mike


Onthenose - how about you doing a bit of research and bringing a 'great share to our attention' for once??

Nothing like a bit of give and take now and then.

[steve fleming]

Really good to see your posts Robbo.

Over the years we have disagreed and theres been times when you've bl**dy annoyed me, however i do believe that you have the best of intentions, and that this site is definitely far poorer without your posts...I think you are onto a real winner with BSA.

Cheers

[trader-jim]

Hi Robbo,

You probably have more supporters than you think.

Over the last year I have bought 5 shares, originally tipped by you(I think)

ANG +234%
BSA +33%
ISS +247% (and some ISSO, 4 weeks ago +173% )[:p][:p]
ITE -19%
RFG +90% (was that your thread?)

so overall not a bad average, in fact a great average. So no complaints from me and would welcome any input from you on these threads and any new ones.

Cheers
Jim

[ONTHENOSE]

Steve,

Unfortunatly Steve i will openly admit i do not have the knowledge, education, experience or time at present to start a thread on sharetrader.

However i do appreciate the time and effort certain people put into this site.

I totally agree with the "Give and Take".. When i actually know what im talking about i will contribute....;)

Regards

Mike



[/quote]

Onthenose - how about you doing a bit of research and bringing a 'great share to our attention' for once??

Nothing like a bit of give and take now and then.
[/quote]

[steve fleming]

quote:Originally posted by ONTHENOSE

Steve,

Unfortunatly Steve i will openly admit i do not have the knowledge, education, experience or time at present to start a thread on sharetrader.

However i do appreciate the time and effort certain people put into this site.

I totally agree with the "Give and Take".. When i actually know what im talking about i will contribute....;)

Regards

Mike




quote:


Onthenose - how about you doing a bit of research and bringing a 'great share to our attention' for once??

Nothing like a bit of give and take now and then.



No worries, Mike. Sorry, it was a bit of a harsh comment. All the best with your investing. Cheers.

[Underlord]

out as you wrote AA:)

.................................................. ..........................
ASX Announcement Date: 25th July 2007
2007 full year results exceed expectations.
BSA Limited (ASX:BSA) announced today its unaudited full year results for the period ended June 30 2007.
Revenue: $158.9 M (2006: $130.6 M),
Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA): $14.3 M (2006: $4.4 M)
Net Profit After Tax (NPAT): $9.0 M (2006: $0.7 M)
BSA achieved results well in excess of its upgraded guidance after a year of success in core business and
internal consolidation of operations. Audited results will be released in accordance with ASX listing rules, by
the end of August.
ENDS.
Contact:
Graham Seppelt, Company Secretary. (08) 8231 7033 or;
Amy Irvine (02) 8748 2464.
BSA Limited is the largest provider of satellite installations for the subscription television industry
and a significant provider of high volume contracting services to the telecommunications industry
and a leading infrastructure and equipment supplier to the broadcast and telecommunication
industries.
For more information visit BSA’s website: www.bsa.com.au

[mamos]

My thoughts on the two announcements:

1. The profit upgrade was entirely expected (if you had read announcements from HY result onwards). FY results were HY results repeated. Hopefully the market will now recognise and re-rate the full year on an appropriate PE multiple. PE is now only 14 FY07.

2. Acquisition.

I was expecting an acquisition in the same industry such as managing contractors. However, the acquisition does appear to be in a growth industry and obtained for relatively cheap. EBITDA multiple of just over 6. A diversification strategy can be beneficial as long as sufficient interrelationships can be identified and utilised.

The parts I like from the announcement are:

- 20% growth trajectory
- the building and mechanical services market is extremely healthy.

[tommy]

Hi all,

Got on to the BSA bandwagon today after da announcement, acquisition seems to have gone ignored by the market? The market seems to be very slow to react to acquisitions at the moment (e.g. DEX, RFG) but re-rating should occur in due time.

Breaking the 90c barrier would be nice:
http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=AU%3Absa&draw.x=0&draw.y=0

[ONTHENOSE]

Hi Guys,

Starting to shape up nicley... A big buy towards close someone picked up 90,000units...[:0]

AA i think BSA has what it takes to be "a market darling"....[:p]


regards

mike

[robbo]

BSA.

Hi ... Everyone.....

Just a very quick and very short ... BSA ...... 'note'.....

Check out the ---- ahem--BSA-- ASX-- BSA announcement today --- on the NAB--National Bank---ASX announcements--and site guys ..... vis a vis ....BSA....yes BSA on NAB site.

You did ..... read that..... correctly..... .


Maybe .... good to---soon---??[?]?--- "let penny drop soon"-- ;)[?]....and Get the--"BSA"-- bigger Picture ....,.. soon ..??-- perhaps --- ..[?]..

imo.... some interesting easy.... first Clues are as follows:

(1) The 2008 --yes--Yr:-- yes---2008-- forecasted EBITA... of:

drum roll-- $22 Millions ---and the credibility that $22M EBITA forcasted-- will have ...imo....(as also being far too conservative due to:-- -- see point (2) below)--

Let that ....."$ 22M "-- Number--$22Mill-- Sink in .....guys--imo-- btw--.... 'tis.... a--imo--- very important one..... in the context of today...imo.....

(2) Market was originally told --by BSA-- that ebita would
be only about $13 Millions --....

....>>.--so then.....What have they (BSA)-- Actually now achieved, delivered and done ...--??

Answer: They have exceeded forecast ..... by over 8.5 %--& done $14.1 Millions ebita.....Real Money.....errrr.....

Work out what will possibly now happen to..... ROE ....btw......and market perception on thier (BSA) --ability to deliver credibility.....

Also..... expect the BSA Reported ACTUAL net -- of $9.1--to be just-- imo--??-- "Maybe....a tad even Higher" ....in the next month official August BSA reported numbers--due to the sums--....( clue. -- corp tax rate is 30% )... ..

(3) Also guys--- NAB Bank--NAB-- have made .....a due diligence// money judgement on the BSA Business Mgt and Business Model" ..... obviously -- and Publicly--

ie: Clue-- Why did NAB choose to announce this .....BSA deal on their own--.;)[?]... NAB ...... ASX announcements... TODAY also ...??...strange maybe...maybe not....??...

(4). --Maybe worth to .....think about it. (.....ahem-- Do they....(NAB)-- know ....."something"--- about Telstra and Project Simba--...surely not...... ;);)....)....before advancing BSA ....so much ready Credit....ie-- $27 mill. ...in what is ....a very..... Tight Current Credit environment...? ??...

.. This is possibly--imo-- a good Clue:-- >>> - This is a strong strong .... clue imo--- .. "a easy to perceive market signal folks "....think this one through .... errrrr..... just.... maybe ....?....)...

(5) What will happen when/if Telstra deal is announced?......possibly in later August...??...

(6) What does the Forward 2008 PE imply ..... on the 2008 EBITA...is the $64 dollar question...? .....Clue--remember emitch.(EMI) now MCU-- ....

(6b)-- And then maybe ask yourself ..... "What the Foxtel Deal underwrite on Revenues going forward really means-- means to amrekts in light of all of above as well....and the quantum...how many other.... $140 M Cap.... co's have got That Sort of revenues and profits -- "locked in"--- as a Sure Solid contractural--foudation for 4 years going forward...????...

How much was it(the Foxtel Deal)-- again..[?][?]..remember FOXTEL.... can anyone......Remember....what Foxtel have signed up for with BSA....in terms of Dollars......???

Question: ----Who are....btw..... the Largest Share-Holders and Owners .....of FOXTEL .... btw....errrrr...... just asking....[?]..


(7). A small Thought to ponder & discuss....

Some ....rarer --- fortunate-- "market darling-- co's"-- trade on present multiples, some on.....drum roll----- Future Multiples.... depending on Div History, and predictability//Certainty-- of Future Earnings ...(Those with Strong Critical Links to Big Multi National Co's is sometimes a Critical Supply Value Chain ....vis a vis--another clue maybe-- -- Michael Porter.......5 Forces style---- Rare situation-- ;)[8D]....and are tehn also in

[tommy]

Hi Robbo,

Glad you're back mate, how are you?

Bought into BSA today, announcement was indeed good. However I cannot determine which NAB announcement you are talking about, can you please point out which one is related to BSA?

Cheers in advance:)

[robbo]

BSA.

Tommy, it was posted on the NAB--- ASX annoucements--at 9.10 am. as of today.

Regards,

robbo. :)

PS. Have now "cleaned up".... and re edited my last BSA post prior to this....although it is still a bit sloppy......also...... note posxcript there too. Bit rushed at present.... sorry !)

Robbo

[tommy]

quote:Originally posted by davidrob

BSA.

Tommy, it was posted on the NAB--- ASX annoucements--at 9.10 am. as of today.

Regards,

robbo. :)

PS. Have now "cleaned up".... and re edited my last BSA post prior to this....although it is still a bit sloppy......also...... note posxcript there too. Bit rushed at present.... sorry !)

Robbo


Hi Robbo,

Err, yes I read that
http://sa.iguana2.com/cache/77e52e0cf82d5ab7cb06b20405918eb4/ASX-NAB-279665.pdf

but still cannot find any word about BSA in this announcement[?]

What da????

Am I missing something?

[robbo]

BSA.

tommy & AA......

First Tommy--- It is....on my IRESS sytem anyway!!--- the Next Announcement--on NAB-- sequentially.... AFTER that one..... you posted Tommy.

Gist of it Tommy-- ..... is on the BSA annoucement.... anyway where they mention NAB..... as the credit provider anyway ....mate.

My post says all that is "the point"--but it is there.

(2) AA-- Like Peter Lynch says--some stocks too i 'don't get"--and if they don't gel for You--do what..... Peter Lynch recommends--....ignore them....!!.....

Obviously we have a very diff perception on fps AA...but that is cool ..... "next!".....

Robbo.

----------------------------------------------------------------



quote:Originally posted by tommy


quote:Originally posted by davidrob

BSA.

Tommy, it was posted on the NAB--- ASX annoucements--at 9.10 am. as of today.

Regards,

robbo. :)

PS. Have now "cleaned up".... and re edited my last BSA post prior to this....although it is still a bit sloppy......also...... note posxcript there too. Bit rushed at present.... sorry !)

Robbo


Hi Robbo,

Err, yes I read that
http://sa.iguana2.com/cache/77e52e0cf82d5ab7cb06b20405918eb4/ASX-NAB-279665.pdf

but still cannot find any word about BSA in this announcement[?]

What da????

Am I missing something?

[tommy]

quote:Originally posted by davidrob

BSA.

It is the Next Announcement--on NAB-- sequentially.... AFTER that one..... you posted Tommy.

Gist of it .....is on the BSA annoucement.... anyway where they mention NAB..... as the credit provider anyway mate.

Robbo.


Got it! Duh, I was looking at the wrong announcement, sorry for the trouble mate [xx(] Thanks mate, I must be getting old[|)]

[tommy]

quote:Originally posted by absolut-advance

True True, I believe its important to invest only in those companies which one truly understands. FPS I dont.



Hi AA,

Yup, that's the way to go, never invest in a company/sector you don't understand, it is difficult enough to invest your hard-earned dough in a company/sector you think you know!

You can never do enough research into a stock... I find it too risky buying a stock based on imperfect information/knowledge, in addition to all those uncertainties to which companies are exposed in the first place!

There are plenty of fish out in da sea, if you know what I mean...

[steve fleming]

quote:Originally posted by mamos

My thoughts on the two announcements:

1. The profit upgrade was entirely expected (if you had read announcements from HY result onwards). FY results were HY results repeated. Hopefully the market will now recognise and re-rate the full year on an appropriate PE multiple. PE is now only 14 FY07.

2. Acquisition.

I was expecting an acquisition in the same industry such as managing contractors. However, the acquisition does appear to be in a growth industry and obtained for relatively cheap. EBITDA multiple of just over 6. A diversification strategy can be beneficial as long as sufficient interrelationships can be identified and utilised.

The parts I like from the announcement are:

- 20% growth trajectory
- the building and mechanical services market is extremely healthy.



I agree Mamos, is was a bit of a left field acquisition

A very good value buy at approx 6 times EBITDA, whereas BSA was trading at approx 9 times EBITDA, so nice bit of value created for BSA shareholders.

Strategically though, its all very strange.

There would be very few synergies I would imagine between the target and BSA’s current businesses or opportunities to implement cost savings.

The market always discounts diversified industrials with exposure to different sectors compared to pure plays. Eg if a fund manger wants exposure to building services they’d prefer a fully focused building services co. like HST or United Group rather than through a building services contractor cum contractor provider cum satellite installer.


Ultimately the acquisition may be seen as an acknowledgement that growth in BSA’s existing businesses has matured and they needed exposure to higher growth sectors to achieve sustained ongoing growth. If you normalise year on year revenues, you are only looking at about 10% top line revenue growth, which is a bit disappointing.


So a good value acquisition….just a bit out of left field, might take the market a while to get their heads around it….BSA need now to get on the publicity trail quick fast explaining to the market their rationale, given the initial apparent obvious lack of synergies/strategic benefits.

Currently i have BSA trading on an FY08 PE of 10 (assuming similar margins in FY08 to FY07 and allowing for issuance of shares to MMM vendors) when it probably should be closer to 15/20.

So a 50%-100% re-rating should happen when the analysts start doing their sums on BSA.

[mamos]

I have had a bit of further look into the company to see what synergies there could possibly be.

The website says:

OUR SERVICES
Triple 'M' is a diverse engineering contracting company focused on the design, installation and maintenance of building services for commercial and industrial buildings, including:
• Mechanical Services
• Air Conditioning
• Heating and Ventilation
• Refrigeration
• Fire Services

I still dont understand what exactly mechanical services is?

It seems they subcontract much less than BSA, typically subcontracting out the installation. They have staff in production, engineering, maintenance etc.

M Foley sees synergies in the training and workforce management. As the businesses will continue to be run as separate entities a lot of support activities will unable to be reduced.

I think the most important aspect may be the comment "I have a great company to leverage BSA into new areas of endeavour". This may have something to do with obtaining increased amounts of engineering type work from Telsta.

I think the Energy Efficient nature of business design is quite a growth industry also with Companies marketing themselves as being Carbon-Neutral etc.

Very Very Good points Robbo. Excellent insight re NAB. I wonder how much the facility is, as that would help to confirm the extent of their expansion plans.


quote:Originally posted by absolut-advance

Hi Steve , I disagree re:Triple M being a left field acquisition and infact I didn't find this sort of acquisition diversification strange at all...

Infact I expected it...

BSA’s business model is really training and managing skilled subcontractors, its business model is suitable across various sectors.

BSA is Essentially a Registered Training Organisation.

I expect this to become more apparent in future acquisitions

AA

[steve fleming]

quote:Originally posted by absolut-advance

Hi Steve , I disagree re:Triple M being a left field acquisition and infact I didn't find this sort of acquisition diversification strange at all...

Infact I expected it...

BSA’s business model is really training and managing skilled subcontractors, its business model is suitable across various sectors.

BSA is Essentially a Registered Training Organisation.

I expect this to become more apparent in future acquisitions

AA



maybe AA...but it was advised to the market as being a new business area to be run/managed discretely from BSA's other businesses.

It definitely sounds like a good business with decent growth prospects...it would have been a fantastic buy for HST.

Conglomerates are not necesarily a bad thing...its just that the market tends to misunderstand/ discount them.

[robbo]

Hi Mamos,

Good points Robbo. Excellent insight re NAB.

.....Robbo,I wonder how much the facility is, as that would help to confirm the extent of their expansion plans.

Answer: Mamos--- deduciable:-- as per NAB //BSA-- announcement---2/3rds of Price of said acquisisoin-- .... namely 2/3rds of $41 Millions .... rest is financed.... thru....BSA scrip.

Directors and Key people --from Biz-- locked in for 3 years.....as well ...... which is , v.good

regards,


Robbo.

------------------------------------------------------------------




quote:Originally posted by mamos

I have had a bit of further look into the company to see what synergies there could possibly be.

The website says:

OUR SERVICES
Triple 'M' is a diverse engineering contracting company focused on the design, installation and maintenance of building services for commercial and industrial buildings, including:
• Mechanical Services
• Air Conditioning
• Heating and Ventilation
• Refrigeration
• Fire Services

I still dont understand what exactly mechanical services is?

It seems they subcontract much less than BSA, typically subcontracting out the installation. They have staff in production, engineering, maintenance etc.

M Foley sees synergies in the training and workforce management. As the businesses will continue to be run as separate entities a lot of support activities will unable to be reduced.

I think the most important aspect may be the comment "I have a great company to leverage BSA into new areas of endeavour". This may have something to do with obtaining increased amounts of engineering type work from Telsta.

I think the Energy Efficient nature of business design is quite a growth industry also with Companies marketing themselves as being Carbon-Neutral etc.

Very Very Good points Robbo. Excellent insight re NAB. I wonder how much the facility is, as that would help to confirm the extent of their expansion plans.


quote:Originally posted by absolut-advance

Hi Steve , I disagree re:Triple M being a left field acquisition and infact I didn't find this sort of acquisition diversification strange at all...

Infact I expected it...

BSA’s business model is really training and managing skilled subcontractors, its business model is suitable across various sectors.

BSA is Essentially a Registered Training Organisation.

I expect this to become more apparent in future acquisitions

AA

[mamos]

I mean how much is the total facility. i.e. How much more can they borrow for future acquisitions.

[steve fleming]

Hi Robbo,

Specifically in relation to BSA, does Foresight Securities mean anything to you??

Cheers

[robbo]

BSA...

HI Steve,

Interesting enquiry Steve ...... errrrr.... Do you .....know ....these guys .. ??

Kindest Regards,

Robbo :)

[zac]

A good rundown on BSA:

FAST-EXPANDING COMPANY IN TELECOM INFRASTRUCTURE
Sydney - Thursday - July 26: (RWE Aust Business News)
************************************************** ***
he telecommunications industry has traditionally been a fast-changing and expanding technology which has kept participants on
their toes, but the more stable area is the infrastructure which make the systems work. BSA Ltd (ASX:BSA) provides high-volume technical services to the telecommunications industry, nationwide. It covers contracting services - high-volume contracting services nationwide at domestic and commercial locations and technical
services - lower-volume project and maintenance work including
equipment design, installation and management services.BSA has intriguing division names like Mr Group, Mr Antenna and Mr Alarms, delivering services to customers across Australia including the supply and installation of domestic free-to-air, digital and alarm
solutions. Its customers include Foxtel, Telstra, Optus and others. Yesterday, the company delivered the ASX two double whammys.BSA announced an unaudited annual net profit for 2007 of $9 million, up from $700,000 in 2006 and also agreed to buy the Triple M building services group. The 2007 full-year results exceeded expectations along with unaudited revenue of $158.9 million (2006: $130.6m).
Earnings before interest, tax, depreciation and amortisation
(EBITDA) was $14.3 million (2006: $4.4m). BSA achieved results well in excess of its upgraded guidance after a year of success in core business and internal consolidation of operations. Meanwhile the company has signed an agreement to acquire one of Australia's leading building services organisations, the Triple M Group
of companies for a total of $43.1 million in cash and BSA shares.
The acquisition delivers a substantial new business area for BSA
in a fast-growing building services market. Together with Triple M, it is anticipated that BSA should lift annual revenues beyond $250 million and increase EBITDA to around $22 million. Triple M designs, installs and maintains mechanical and fire services for many of Australia's largest building projects. Services include leading environmental and energy-efficient design of mechanical services such as heating, air conditioning, ventilation and fire services including protection, detection and suppression systems. Located in NSW and Queensland, the privately owned company was
established in 1994 and recorded close to $70 million revenue delivering more than $7 million EBITDA in the previous financial year. The purchase, which is expected to be completed shortly, will bepaid in a mixture of cash and scrip, the scrip making up one third of theacquisition price with 21.1 million shares issued at 68c each.
The remainder of the purchase price is to be funded through a
new debt facility with the NAB. Each of the five key executives in the Triple M business have been contracted to remain employed by the company for at least three years. BSA managing director Mark Foley says the acquisition will form a discrete division of BSA which will be encouraged to continue its own
strategic plan for growth, including acquisitions. The BSA board believes the purchase will strengthen the companyand generate more than $250 million in revenue and about $22 million EBITDA IN 2008.
Shares of BSA yesterday rose 3c to 83c. Rolling high for the
year is 90c and low 22c. Dividend is 2c to yield 2.41 per cent.
Earnings per share is 2.68c and p/e ratio 30.97. The company has 158.3 million shares on issue with a market cap of $131.4 million.
In June BSA announced it had signed a four-year contract extension with Foxtel, continuing its position as one of the key providers of installation and maintenance services to Foxtel's base of nearly 1.3 million subscribers. BSA began providing residential and commercial satellite installation and maintenance services to Foxtel customers in 1998 and the companies have developed a strategic partnership that n

[ONTHENOSE]

Good day for BSA...

Closed @ 87cents... How far can she go...[:p]

[robbo]

BSA.

An Excellent overall Synopsis Zac.

Well done Zac ...... on digging up that BSA --- COMPANY BRIEF & OVERVIEW ..... .

... Many thanks.

Kind Regards,

Robbo.:)

-----------------------------------------------------------------

[quote]quote:Originally posted by zac

A good rundown on BSA:

FAST-EXPANDING COMPANY IN TELECOM INFRASTRUCTURE
Sydney - Thursday - July 26: (RWE Aust Business News)
************************************************** ***
he telecommunications industry has traditionally been a fast-changing and expanding technology which has kept participants on
their toes, but the more stable area is the infrastructure which make the systems work. BSA Ltd (ASX:BSA) provides high-volume technical services to the telecommunications industry, nationwide. It covers contracting services - high-volume contracting services nationwide at domestic and commercial locations and technical
services - lower-volume project and maintenance work including
equipment design, installation and management services.BSA has intriguing division names like Mr Group, Mr Antenna and Mr Alarms, delivering services to customers across Australia including the supply and installation of domestic free-to-air, digital and alarm
solutions. Its customers include Foxtel, Telstra, Optus and others. Yesterday, the company delivered the ASX two double whammys.BSA announced an unaudited annual net profit for 2007 of $9 million, up from $700,000 in 2006 and also agreed to buy the Triple M building services group. The 2007 full-year results exceeded expectations along with unaudited revenue of $158.9 million (2006: $130.6m).
Earnings before interest, tax, depreciation and amortisation
(EBITDA) was $14.3 million (2006: $4.4m). BSA achieved results well in excess of its upgraded guidance after a year of success in core business and internal consolidation of operations. Meanwhile the company has signed an agreement to acquire one of Australia's leading building services organisations, the Triple M Group
of companies for a total of $43.1 million in cash and BSA shares.
The acquisition delivers a substantial new business area for BSA
in a fast-growing building services market. Together with Triple M, it is anticipated that BSA should lift annual revenues beyond $250 million and increase EBITDA to around $22 million. Triple M designs, installs and maintains mechanical and fire services for many of Australia's largest building projects. Services include leading environmental and energy-efficient design of mechanical services such as heating, air conditioning, ventilation and fire services including protection, detection and suppression systems. Located in NSW and Queensland, the privately owned company was
established in 1994 and recorded close to $70 million revenue delivering more than $7 million EBITDA in the previous financial year. The purchase, which is expected to be completed shortly, will bepaid in a mixture of cash and scrip, the scrip making up one third of theacquisition price with 21.1 million shares issued at 68c each.
The remainder of the purchase price is to be funded through a
new debt facility with the NAB. Each of the five key executives in the Triple M business have been contracted to remain employed by the company for at least three years. BSA managing director Mark Foley says the acquisition will form a discrete division of BSA which will be encouraged to continue its own
strategic plan for growth, including acquisitions. The BSA board believes the purchase will strengthen the companyand generate more than $250 million in revenue and about $22 million EBITDA IN 2008.
Shares of BSA yesterday rose 3c to 83c. Rolling high for the
year is 90c and low 22c. Dividend is 2c to yield 2.41 per cent.
Earnings per share is 2.68c and p/e ratio 30.97. The company has 158.3 million shares on issue with a ma

[steve fleming]

quote:Originally posted by davidrob

BSA...

HI Steve,

Interesting enquiry Steve ...... errrrr.... Do you .....know ....these guys .. ??

Kindest Regards,

Robbo :)




Hi Robbo, don’t really know them but they do seem to have quite a cosy relationship with BSA.

It was Foresights that crossed that glaringly obvious 600K parcel last week and I understand they may have also been involved in a couple of other bits of BSA manipulation over the last few weeks.

Apparently the 600k cross @76c (substantially below the market price at the time) helped lower BSA’s 30 day VWAP to ensure that the issuing of shares to the vendors @68c remained fair.

Cheers

[OneUp]

Anyone else disappointed with the decrease in margins 1H vs 2H?

EBITDA $7.2m 1H/ Revenue $74.9m = 9.6% margin

EBITDA $7.1m 2H/ Revenue $84.0m = 8.4% margin

NPAT $4.5m 1H = 6.0% margin

NPAT $4.5m 2H = 5.4% margin

Doesn't stack up with the MD's argument that margins are sustainable. I would have thought margins should increase given the apparently scaleable model.

Any thoughts on the causes?

[Underlord]

Interesting read...Telstra starting to put the acid on. I wonder who will win this battle and what effect this will have on BSA
.................................................. ....................
Telstra ups ante with upgrade to cable
Email Print Normal font Large font Matt O'Sullivan
August 1, 2007

Advertisement
AdvertisementTELSTRA is spoiling for a fight with the Federal Government on broadband ahead of the election after signalling that it is working behind the scenes on an upgrade to a cable network connecting 2.7 million homes instead of a high-speed broadband network.

Just a day after Telstra's chairman, Donald McGauchie, delivered a blistering attack on regulation, the chief executive, Sol Trujillo, made it clear the company would not be toning down its demand for changes to telecommunications policy in the lead-up to the election later this year.

Yesterday, Mr Trujillo indicated Telstra was working on alternatives to a fibre-to-the-node network in metropolitan areas, such as an upgrade to the Foxtel cable, which could eventually provide broadband speeds of between 50 and 100 megabits per second to 2.7 million homes.

Industry insiders believe Telstra's attempt to increase pressure on the Government over the construction of a high-speed broadband network in the cities is designed as a smokescreen for the cable upgrade.

Telstra is expected to ramp up the cable's speeds - used to deliver pay TV and next-generation broadband technology - to 30 megabits per second by August, before launching the upgrade a month later.

"As you saw with Next G, we didn't announce Next G before we built it, we just announced it when we did it," Mr Trujillo told reporters yesterday.

Telstra admitted earlier this week that it had started pouring some of the $4.1 billion earmarked for a high-speed broadband network into other investments. It has also left open the possibility of walking away from the Government process to select a company to build a fibre network.

A Citigroup analyst, Tim Smeallie, said the Foxtel cable could offer high-speed broadband to 2.7 million homes at a total cost of under $700 million, less than a fifth of the cost of replacing the copper wires that run from telephone exchanges to street nodes with fibre.

"We have argued for some time that Telstra has many technology options," he said. "The chairman's and CEO's comments suggest that Telstra will not invest in [fibre-to-the-node] until there is a change of regulatory settings and telecommunications policy settings.

"We don't envisage that to occur before the end of the year."

Earlier yesterday, Mr Trujillo echoed his chairman's comments from the day before when he said Australia suffered from a lack of investment in telecommunications because "money has been spent in the wrong places and because the policy settings don't make it economic".

Mr Trujillo's comments failed to provoke a firm rebuttal yesterday from the Communications Minister, Helen Co onan, who would only say: "Telstra's commercial priorities are a matter for the company, but consumers are a matter for the Government and that is why we have set up an expert taskforce to ensure that a new fibre network is built."

[steve fleming]

Now its Findlay’s turn to be playing with BSA.

http://www.sharetrader.co.nz/topic.asp?TOPIC_ID=24707

Almost all of the BSA trading over the last week or so has involved Findlay’s been either on one or both sides (usually) of the trade.

There is no way BSA deserves to be on an 08PE of 9 (125/14), nothwithstanding the current market conditions.

I just think it is trading very very strangely….all the broker crossings recently make me suspicious that its being kept down for some reason...and its illiquidity means it can be manipulated very easily.

I think its very suspicious how it was allowed to hit 68 cents today….maybe ASIC raised some concerns as to the issue price, I don’t know.

[steve fleming]

quote:Originally posted by absolut-advance

Its definitely a Strong buy, but ive already got more than my share.

AA

p.s Steve how do you find out this information?


Hi AA


Lets hope the brokers stop playing their games and let this one go soon, so it starts trading at more appropriate levels...i thought it was all set a couple of weeks ago....but wasn't to be.

Info re brokers is from Bloomberg

Cheers

[steve fleming]

Interesting to see some nice director buying resulting in BSA up 13% over the last half of the week.

$54k on 9 August
$89k on 8 August (bidding BSA up from 67 to 79)
Probably more yesterday as well.

In fact it appears as though the Director Brian Baldwin is about the only person interested in BSA at the moment.

[mamos]

Yeah i too think the director buying announcement gave BSA some support yesterday.

[robbo]

BSA.

Overall; I feel that ....BSA ....has stood up to the ....Market Correction ..... quite well.

Although it is supported quite well, I suspect some sold their BSA to cover other positions they were unintentionally exposed to-- and just had to get into more CASH to cover....

Now that BSA Director--(Brian Baldwin)-- has sent the clear "buy signal" ---by putting his own significant cash--$$$--- Money On the Table-- and with Foxtel posting such a Solid Profit and going gangbusters...and with Official Report and And audited figures---$14 Million ebita and massive upgrade from last years NPAT around $9.1M---net profit after tax-- -- just around the corner....(later this week--am hearing...???-- might be, now.... time ....to... get set and ready....

I am.....Still predicting $1.25 ++ ....in next 30 days...for BSA-- from about now...

kind regards,

robbo.

[mamos]

BSA FY07 results and FY07 guidance

I personally believe that the guidance is very conservative. The $22.5m EBITDA is forecasting no growth and perhaps even decline in BSA's core operations as the FY08 contribution from Triple M more than covers the difference.

This seems at odds with the statement:

"The strong growth trend and profitability will continue into the foreseeable future".

I think their forecasts are consistent with the very conservative nature of BSA's management. Will we see repeated profit upgrades during the year similar to last year.

PE of 11 FY08.

No mention of Project Simba specifically however, there are statements indicating an ongoing relationship with Telstra. May need further clarification on where they are with these PRoject SIMBA tenders.

From a recent news article:

Telstra outsources work on its network to companies such as Transfield Services, ABB, BSA, Service Stream, Visionstream and Silcar Communications.
It is believed all have tendered to be part of SIMBA. The project has a target start date of August 1.
"Telstra have indicated they want to cut the number of suppliers back even further, so there will be winners and losers," one supplier told BusinessDaily.

"I think outsourcing will continue within the Telstra environment.
"So this step is to rationalise a whole bunch of contracts that exist and sort of consolidate them and get cost savings out of volume and some different pricing regimes."

[steve fleming]

For there to be only 3 trades all day in BSA today - the day that BSA released its results presentation and the day after its FY07 announcement - is pathetic.

The market simply doesn't care about BSA at the moment.

[mamos]

AA. What do you mean the writing is on the wall?

[tommy]

Hi all,

What is BSA's current and forward PE?
Projected NPAT growth rate seems to be a lot lower next year...

[mamos]

AA. Those figures look extremely good but I do not think can make sensible comparisons between this year and last year as significant restructing was occurring and even though sales were reasonably high costs were also significant.

Tommy. The projections I believe are very conservative indeed. Foxtel is booming. The unknown question is how much work BSA picks up from Telstra under project SIMBA.

[mamos]

Downer and BSa share the Foxtel installation, with BSA's share now over half.

[steve fleming]

I was pretty close to selling my BSA, having not at all been impressed with their diversification strategy.

However, this sustained director and shareholder buying is changing my mind.

[mamos]

I am a little wary of the acquisition too as it is not exactly one they can integrate that well with their existing business. At least it is earnings accretive.

I think the forecasts are very conservative and is accordingly trading on a low PE for FY08.

I think it is cheap right now.

Still waiting for news on deals with Telstra.

[mamos]

I think the forecasts are very conservative and is accordingly trading on a low PE for FY08.

Still waiting for news on deals with Telstra.

Thanks for the news KW. This is very disappointing for BSA holders.:(:( Although the business will still be profitable it will now have to rely more heavily on the Foxtel contract. If they had won the Telstra contract we would be over a $1, but thats the way life goes.

I was anticipating BSA would win the contract, but it probably wasnt big enough in the end to do so. I believe now the acquisition confirmed that management felt they were unlikely to win the contract as it wouldn't be diversifying if it knew it had to ramp up to meet the demands of the Telsta contract.

Perhaps this was the reason for the conservative profit forecasts contributions from the existing business.

Disc: I have sold out completely today at cost. BSA was a significant proportion of my portfolio but now I am also far less confident of their growth prospects.

[steve fleming]

hmmm....no ASX annoucement. Thats poor form from BSA.

If you look at the transfeild annoucement, who also lost a TLS service contract, the contract won't end until 30/06/08, so shouldn't have too much impact on FY08 forecasts. ..otherwise BSA are going to be a bit of a laughing stock having to retract some forecasts they made only a couple of weeks ago.

I agree Mamos, the shine has really been taken off BSA.

[OneUp]

Im still holding, I feel BSA is still good value as it was heavily undervalued anyway, Disappointing as it is Im seeing today as a market over reaction and the current contract is still in place to May 2008 also Triple M was a good investment at the right price which will add to the bottom line. Foxtel also is pumping hard out.

I have emailed the company in regard to how this may impact our investments,I will be interested in their response and would expect a announcement in regard to concern by shareholders.

regards


AA

AA

How much should the market pay for a supplier of a low margin commodity service to now a single major customer? (A few more with the recent acquisition, which now looks like a smart move). P/E of 20, 10...7? I carefully considered BSA because of the terrific outlook for Foxtel volume growth in FY08 but never bought shares because of the very high non-renewal risks contractors like BSA face (I have been taught some expensive lessons in similar scenarios in the past).

If you listen to the boardroom radio commentary Foxtel appear to know BSA's costs to the nth degree and price out any "supernormal profit" - Foxtel reduced the rates it paid for 10 years running until 2006 when they were increased slightly. The power is definitely with Foxtel, not BSA.

I'm a little startled that Telstra has cut BSA. According to the MD (in the presentation mentioned above) Telstra were very happy with BSA because they were the only ones training new technicians. Doesn't add up. Just as the comments he made that margins in 1H were sustainable didn't add up with what we saw in 2H (see my earlier post...)

Good luck.

[mamos]

Typical example of where the bargaining power is with the customer (who is effectively a monopoly).

[Fodder7]

BSA still envisages opportunities to subcontract to one or more of the sucessful tenderers. Given the size of the contracts compared to BSA's capacity, it's probably all they could have hoped for anyway.

Given that this decision won't have a significant effect on 07-08 and by then we should know more regarding the future work load, perhaps the selling is overdone.

The pricing power of Foxtel is a concern but this is limited by the tight labour market at the moment.

[trader-jim]

The way I see it is Telstra wanted to deal with just a few contractors rather than 100. Due to the tight labour market the three winners will then need to subcontract some of the work. This will cut the profit margin for BSA but is not as bad as it first sounded. They have a year on the current contract to sort out the relationship.

[mamos]

Why wont the contractors just go to work for Service stream, vision stream etc.

[Underlord]

Directors seem to be buying up large over the last couple of weeks...more buying today. Maybe there is more in the pipeline that we are not aware of .

I sold yesterday at a slight loss. I was of the mark pretty quick. Brought back in today at 55 after reading BSA announcement and I am glad I did directors give me confidence

UL

[lissica]

Big buys alright......3.8million shares; that's almost 80% of todays trades. So who's been selling to the directors?

I topped up today at 55c. Think it's been oversold.

[steve fleming]

Big buys alright......3.8million shares; that's almost 80% of todays trades. So who's been selling to the directors?

I topped up today at 55c. Think it's been oversold.

This is fascinating.

Birketu has purcahsed the absolute limit they can (19.9%) without making a full take-over.

So there can be no more buying support from Birketu tomorrow.

Birketu is controlled by Bruce Gordon, multi- billionaire WIN TV owner, and one of Australia's 10 most wealthiest, so certainly very deep pockets.

Are we going to see a takeover?

[steve fleming]

This is fascinating.

Birketu has purcahsed the absolute limit they can (19.9%) without making a full take-over.

So there can be no more buying support from Birketu tomorrow.

Birketu is controlled by Bruce Gordon, multi- billionaire WIN TV owner, and one of Australia's 10 most wealthiest, so certainly very deep pockets.

Are we going to see a takeover?

Also, Gordon's billions are all self-made, which would probably qualify him as one of Australia's most astute and sucessful businessman.

He isn't the type to throw good money after bad, so to spend $2.2m + today is a massive sign of confidence in BSA.

[steve fleming]

and wheres Robbo these days?

Don't say he's done another hit & run!:)

[Underlord]

Edwin Maxwell Cowley - Non Executive Director

Max is the principal of accounting firm E M Cowley & Co and has practised as a chartered accountant as principal for 41 years. He is a Director of Bidvest Australia Limited, WIN Corporation Pty Limited and a number of private companies. Max is the company secretary of Birketu Pty Limited, BSA's single largest shareholder and has been closely involved with the development of WIN Corporation Pty Limited, Australia's largest regional broadcast network from its commencement and over the past thirty years. His years of corporate and financial experience are extensive. Max was appointed to the Board of BSA Limited 2 May 2006.
.................................................. .................................................. .......................

I'd say Edwin and Bruce Gordon are quite close considering Ed has been involved with Win Corp for 30 odd years

[steve fleming]

Geez these Directors have deep pockets....they have picked up well over 7 million BSA shares the last couple of weeks.

Who knows what the BSA share price would have been without this support?

Incidentally, all the directors/entities are trading through Findlays, who are doing very well out of all these trades.

[mccollr]

[

A easy read : Making money from CFD Trading by Catherine Davey is brain ****... thought read.


AA[/quote]
Thanks for that AA. I will have a read.

[Underlord]

BSA Secures OPTUS Consumer HFC Services Contract

2 Year Term
Revenues expected to be in excess of $30 Million

Prior to this contract BSA was only doing the Brisbane work for OPTUs this new contract now means they will be doing 50% of all the availiable work across OPTUS's HFC network in Australia's 3 major capital cities


All good IMO

[Bobbyvee]

AA, CFDs and rum sounds like a very high risk combination indeed. Take care!

[Underlord]

A new issue of 150,000 shares under the BSA Executive Securities Plan at a price of 0.68........can anybody explain to me what this exactly means

Appreciated

[Underlord]

With Souls now increasing there stake in BSA plus directors topping up you would have to say that BSA are still worth a hold .....I think I will sit on these for a while if its good enough for the big boys its good enough for me:D

Tis quite a boring stock though and I think patience will required with this one

[steve fleming]

BSA.



I am.....Still predicting $1.25 ++ ....in next 30 days...for BSA-- from about now...

kind regards,

robbo.

Well it didn't quite make Robbo's $1.25, but at less than 50cents BSA represents pretty low risk buying.

ALmost 15% of the company traded the last couple of weeks, and almost of those sold have been absorbed by 'safe hands' - Souls, Gordon and the Directors.

You wouldn't think that there would be too much selling pressure left...volume has reduced considerably, its just the rats and mice selling now, so BSA should bounce nicely on any good news.

[Huang Chung]

I now look back at 23 April and just smile.........

[Skip]

AA I disagree. This was another Robbo special. He made wild predictions on the 23 April raving about BSA being a 3 bagger and being ready to pop and hitting $2.25 by xmas. His usual followers backed the stock and it rose accordingly. Now, at .45 cents and well below the share price that it was in April, this is just another pump and dump shocker like ITE. BSA has dropped over 50% of it's price in the past 6 weeks from a high of almost 90 cents down to a low of .43 cents today and continuing on a downward spiral. The trend is not good! Good luck to you AA and other holders, but it does not look good for you

[lakeys]

price ..47c
pe ..8
eps ..5.83
div ..6.8%

NPAT 9m

quote just realeased annual report "set to deliver improved finanual results for 07/08"

and to top it off, more than one director buying up big time at higher prices than 47c within the last 4 weeks.

Big seller seems to have run out of stock to sell over the last few days.

discl : brought a few late last week.

thoughts??????????

[steve fleming]

Yep,

Fwd PE of approx 6.

A couple of very successful Australian investors substantially increasing their holdings in BSA.

Diversifying into one of the fastest growth areas - industrial services.

Directors have said:

"BSA will increase sales and profit over the next
year by delivering results based on stable high
performance business units delivering consistent
results.

The company has plans to:
• Integrate Triple M into the BSA group to take
advantage of skills, efficiencies and synergies
that are evident since the acquisition.
• Re-focus the expanded BSA group to
become a broader based, significant industrial
services company.
• Maintain the high level of support for the
BSA key customers in FOXTEL, Telstra,
OPTUS, AUSTAR and all other customers
in the group.
• Participate in opportunities for multi-site
tenders for institutional clients.
• Expand special hazards capabilities in Fire to
target resources and mining markets.
• Accelerate growth in the maintenance
divisions in support of current installations.
• Continue its trainee programme to create
more skilled technicians upon which to rely as
a flexible resource in the future.
• E xpand the use of the company’s skill base
with further fibre optic contracts.
• Consider further opportunities for
diversification."

Represents a very compelling buy at these levels, and i have been buying.

[mamos]

The results for this year will be good, but what about going forward?

My concern is that presumable lower margins would be received from contracting out to SSM than directly to Telstra, as SSM must take a cut too. Why wont the contractors just move on to SSM who contract directly with Telstra, instead working for BSA who contract to SSM and then to Telstra?

What has surprised me is the muted reaction to the SSM shareprice given they won a billion dollar contract.

[steve fleming]

The results for this year will be good, but what about going forward?

My concern is that presumable lower margins would be received from contracting out to SSM than directly to Telstra, as SSM must take a cut too. Why wont the contractors just move on to SSM who contract directly with Telstra, instead working for BSA who contract to SSM and then to Telstra?

What has surprised me is the muted reaction to the SSM shareprice given they won a billion dollar contract.

Mamos, based on the numbers in the AR, it would appear that on a pro-forma basis (ie including MMM) BSA's telecom/broadcasting segment/division contributed to only approx 25% - 30% only of BSA's FY07 NPAT.

THerefore - Telecom (telstra and optus) does not appear to be BSA's key profit driver. The money is being made in Subscription Tv (Foxtel) and going forward in MMM. Only highlights the fact that this has been a major over-reaction to the loss of the TLS contract, and suggests why the smart money has been buying recetnly.

While previously not a fan of this acquisition, it is apparent now that synergies are evident, and that this strategy of "de-risking" existing operations makes sense.

[steve fleming]

Have we seen the lows?

Bid up all day to finish up 12%.

Buying below 50 cents the last couple of weeks was a long term no-brainer IMO.

[OneUp]

For FY09.

We've got $12m NPAT forecast for 08. Then shave off 30% for the Telstra contract. So $8.4m. Then add 20% growth for Foxtel and the Triple M. That gives $10.1m. If that's in the ballpark, then today's market value of around $94m seems fair i.e. a FY2009 P/E 9.3.

Compare BSA to SSM.

SSM FY09 EBITDA = $48m = 7.4x

BSA FY09 EBITDA (based on above assumptions) = $18.5m = 5.1x

So BSA is probably trading at a discount (if someone has the time to work out the NPAT multiples would be more useful), but liquidity and size must account for some of that.

I'm lost as to why BSA is worth a buck or 10.2x EBITDA and a 50% premium to SSM.

[Sauce]

Hi OneUp,

Don't those figures indicate BSA is potentially trading at a 45% discount vs SSM? Of course I realise you are making the point that it would be hard to value the shares at $1 each today, but you must admit there appears to be a solid case presenting itself for investment at these levels.

There seems to be a pretty good margin of safety built into the share price for a stock that is making and growing profits.

As well as over reacting to the loss of the Telstra contract, I think the market is factoring in more uncertainty over the Triple M acquisition than is warranted.

I am far from an authority on these things but the directors seem pretty fired up about the synergies available and they are certainly putting their money where their mouth is. Correct me if I am wrong they are more qualified, and are in the best position to know the likelihood of success than anyone.

Perhaps $1 within 3 months is optimistic but my guess is that once figures show the new acquisition adding to the bottom line, the market will re-rate the stock.

Regards,

Sauce





For FY09.

We've got $12m NPAT forecast for 08. Then shave off 30% for the Telstra contract. So $8.4m. Then add 20% growth for Foxtel and the Triple M. That gives $10.1m. If that's in the ballpark, then today's market value of around $94m seems fair i.e. a FY2009 P/E 9.3.

Compare BSA to SSM.

SSM FY09 EBITDA = $48m = 7.4x

BSA FY09 EBITDA (based on above assumptions) = $18.5m = 5.1x

So BSA is probably trading at a discount (if someone has the time to work out the NPAT multiples would be more useful), but liquidity and size must account for some of that.

I'm lost as to why BSA is worth a buck or 10.2x EBITDA and a 50% premium to SSM.

[steve fleming]

For FY09.

We've got $12m NPAT forecast for 08. Then shave off 30% for the Telstra contract. So $8.4m. Then add 20% growth for Foxtel and the Triple M. That gives $10.1m. If that's in the ballpark, then today's market value of around $94m seems fair i.e. a FY2009 P/E 9.3.

Compare BSA to SSM.

SSM FY09 EBITDA = $48m = 7.4x

BSA FY09 EBITDA (based on above assumptions) = $18.5m = 5.1x

So BSA is probably trading at a discount (if someone has the time to work out the NPAT multiples would be more useful), but liquidity and size must account for some of that.

I'm lost as to why BSA is worth a buck or 10.2x EBITDA and a 50% premium to SSM.

An FY08 profit of $12m assumes a fall from pro-forma FY07 ($13.1m) when management has forecast increased profitability

(As advised to the market: Had the unaudited results relating to Triple M been consolidated from 1 July 2006 consolidated profit would have been $13.1m for FY07)

By my calculations, of the $13.1m pro-forma NPAT, the TeleCommunications/ Broadcasting segment of BSA contributed about $4m to that NPAT (or 30%).

Of that $4m:

·Some of this profit relates to the Optus contract – which has now been extended;

· Only the profit directly related to services on the TLS "Copper" network has been lost;

· BSA has the opportunity to provide services to the prime contractor under a subcontracting arrangement to reagin some of the lost margins.

So to assume the full 30% of NPAT relating to the Broadcasting/Telecom segment has been lost going forward is very harsh IMO!

[OneUp]

Steve what are you picking for F09 profit?

[steve fleming]

Steve what are you picking for F09 profit?

North of $15m at a minimum.

+ upside from their flagged future acquisitions.

[mamos]

What I find confusing is that BSA mentions in previous investor presentations that:

Key clients – FOXTEL, Telstra (others) positioned for growth, as partners.

and then when they didn’t win the contract:

The fact that our overall size is not commensurate with winning ten times the work volume we currently performed has not surprised us.:eek:

Well if it hadn’t surprised them why do they mention the ongoing partnership with Telstra when they knew there was contractor consolidation occurring with Project SIMBA that they wouldn't be part of?

Also, I would like to know whether there is any chance of retaining work apart from the maintenance services on its “copper” network with Telstra after 30 June 2008. Will have to ask the company I think.

[steve fleming]

Also, I would like to know whether there is any chance of retaining work apart from the maintenance services on its “copper” network with Telstra after 30 June 2008. Will have to ask the company I think.


Mamos, BSA offers a number of other telecommunication services in addition to the "copper" network maintencance contract (that it lost).

Other services include various optical fibre support services and tower and mast installation and maintenance services.

BSA has not advised that they will no longer continue to supply these services to TLS.

[steve fleming]

Mamos, BSA offers a number of other telecommunication services in addition to the "copper" network maintencance contract (that it lost).

Other services include various optical fibre support services and tower and mast installation and maintenance services.

BSA has not advised that they will no longer continue to supply these services to TLS.

Also from the BSA website:

"TELECOMMUNICATIONS EQUIPMENT SUPPORT SERVICES

BSA also provides design, installation and commissioning services for telecommunications equipment for many of the major carriers in Australia. These services can range from the simple through to complex.

This significant and growing capability in the design, installation and commissioning of “In Plant” network equipment includes installation of DSLAMs and SDH Equipment into Telstra exchanges and other network points of presence.
Design and establishment of Telstra Equipment Building Access (TEBA) spaces or equipment spaces in other network locations.
Design of equipment installation.
Gaining access to Telstra (or other) Exchanges and Ducts (as applicable)
Installation and commissioning of equipment, including the running and termination of MDF,
DDF and Optical cables and the connection of power and network alarms.
Commissioning of installed equipment."

[steve fleming]

Great news!!

BSA is starting to get some broker coverage!

Ord Minnett put out a Strong Buy on BSA on Friday!

Ord Minnett have also been putting their money (or their client's money!) where their mouth is....buying up BSA strongly over the last week!

[Sauce]

It certainly seems to have had a positive effect on the share price today.



Great news!!

BSA is starting to get some broker coverage!

Ord Minnett put out a Strong Buy on BSA on Friday!

Ord Minnett have also been putting their money (or their client's money!) where their mouth is....buying up BSA strongly over the last week!

[mamos]

Does anyone have a link to the report?

Thanks

[brettdale]

Well I am happy with my $1.70 Dividend. :-)

[Footsie]

This stock looks TOO cheap ...... why?

Is the market THAT inefficient?

[Footsie]

AA u still trading CFD's?>

IMO i think CFD's are too dangerous for 98% of the population

I have friend who used to work for a CFD provider.... and he concurs saying that about 98% of people lose money !!!

You end up watching every tick. I found i would make and lose a couple of grand like it was nothing / monopoly,.... yet a couple of grand is still a lot of money for me.

IMO you are better to go and borrow from the bank then invest as you normally would.
Thats what i've done and its worked well for me.

in 06 i was 50% leveraged.... now that's reduced to about 25% (through growth)

[Footsie]

Good on you. good luck

Discipline is the key

[steve fleming]

Is anyone else wondering what's happened to "Switched On" - the BSA stakeholder newsletter??

I've been hanging out for my copy of the second edition for weeks now!!

[steve fleming]

renewed interest??

Touched levels today not seen since the massive selldown on the loss of the TLS contract.

[steve fleming]

renewed interest??

Touched levels today not seen since the massive selldown on the loss of the TLS contract.

keeps going up.

7 UP days in a row!!!

[skinny]

Averaged down after the sell off from loss of the TLS contract...and now well in the green and expect it to head +75c barring broad market sell off (no small risk) over the next few months

[steve fleming]

For example there have been Labor election promises to re vamp to high speed broadband to the value of $10 Billion dollars.(how much of that would BSA need to grow from its 117 million market cap ;) )
.

With Kevin07 committed to rolling out his national broadband network, including the connnection of all Primary and Secondary schools to the network, I wonder how much potential there is for BSA to pick up some of this installation work?

[mamos]

How do you rate BSA comared to SSM, who won AAS contract.

[tommy]

Hi AA, steve and others,

BSA on a steady uptrend albeit on low volumes since latest contract announcement despite market volatility, and still looks undervalued.

http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=AU%3Absa&draw.x=0&draw.y=0

Surely Labor's national broadband rollout will trickle down to BSA in the form of additional contracts :-)

[steve fleming]

Hi AA, steve and others,

BSA on a steady uptrend albeit on low volumes since latest contract announcement despite market volatility, and still looks undervalued.

http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=AU%3Absa&draw.x=0&draw.y=0

Surely Labor's national broadband rollout will trickle down to BSA in the form of additional contracts :-)

Yes Tommy, lots to like about the AGM update:

-"the loss of installation and maintenance work for Telstra by
competitive tender which incidentally has barely impacted our growth expectations"

-"BSA will maintain its position in the industry as the largest
service provider to the subscription television industry in Australia."

-"every division has been profitable and we are now positioned for this trend to continue as we move forward"

[ONTHENOSE]

Hi guys

What are your thoughts on the Hills Proposal

[steve fleming]

Buying below 50 cents the last couple of weeks was a long term no-brainer IMO.

And a no-brainer it turned out to be.

The HIL merger effectively prices BSA at 90 cents.

And in further good news, Citigroup is now covering BSA, with a 93 cents target.

[steve fleming]

And a no-brainer it turned out to be.

The HIL merger effectively prices BSA at 90 cents.

And in further good news, Citigroup is now covering BSA, with a 93 cents target.

Excellent summary of the HIL/BSA transaction out today:


•Hills brings significant product opportunities in markets with growth (FTTH, satellite, delivery of triple play, wholesale A/V market)
•Hills has the R&D, engineering, manufacturing and sourcing capabilities. BSA has the delivery mechanism
•No other organisationin the space will have the same end to end capability
•BSA balance sheet strengthened and backed by a “Big Brother”
•Absolute focus on profitable growth
•Size and backing to pursue opportunities
•Hills provides access to corporate resources across the businessspectrum from M&A to compliance
•Synergies exist between the BSA’sTriple M business and existing Hills businesses and contacts
•Cost synergies via purchasing power to be aggressively pursued
•Hills New Zealand operations provide a beach head for BSA
•Market re-rating of BSA

[steve fleming]

Given the markets muted reaction to HIL's annoucement, and as HIL have now had to abandon their $50m cap raising, it would appear BSA got the better part of the deal.

[steve fleming]

Well, very little interest/discussion on the thread in relation to the biggest thing that has ever happened to BSA - ie the HIL merger.

Would be nice to have Robbo back, as at least he would be generous enough to contribute some decent analysis/discussion.

Anyway, heres a little bit of what Huntleys reckon:

"As Australians fill their homes with the latest TVs and entertainment technology systems little thought is given to the faceless components and smaller electronic systems which make the home entertainment revolution possible. Yet there’s money to be made behind the scenes in products like digital antennas, satellite dishes for pay TV, digital set-top boxes, fibre-to-the-home, the parts which support them, and their installation. HIL understands this and also thinks the sector’s growth is far from over. This week’s conditional proposal to merge the antenna and TV systems business in Australia and New Zealand with BSA, a listed broadcasting transmission products and pay TV installation contractor, would create a vertically integrated player which resolves the strategic disadvantages and lack of competitive scale both firms currently face. The merged entity will have FY08 revenues of $370m, comprising $250m from BSA and $120m from HIL.

BSA will acquire the Hills antenna and TV systems business for 93.3m BSA shares before issuing $47.5m of convertible notes to HIL at 90c per note, which will convert into 52.8m BSA shares. After the transaction HIL will own 50.1% of BSA. The transaction is subject to the recommendation of an independent expert, approval by BSA shareholders, due diligence and tax rulings.

The upside for HIL shareholders is access to BSA’s distribution channels. HIL has the key products – fibre-to-the-home, satellite, triple play and wholesale audiovisual – as well as the R&D, engineering, manufacturing and sourcing capabilities, while BSA has a large share of Foxtel’s installation work and a smaller share of Austar and Optus. HIL currently installs only for Austar. The merger would increase HIL’s share of components used in BSA’s work for Foxtel, Austar and Optus and the merged firm would have more bargaining power with Austar than the two independents currently have. No other organisation in the sector will have the same end-to-end capability. The deal is more about vertical integration and increasing volumes than cost synergies: there are few rationalisation benefits. The scale economies should enhance margins in this very competitive, low-margin sector.

Penetration of pay TV in Australia is still only around 20%, which compares with over 80% in the US and 40% in the UK, and is growing at mid- to high single digits. So there is plenty more upside for installation contractors and suppliers."

[macduffy]

You've aroused my interest in this stock!
Good explanation of the Hills merger details by BSA MD on ShareScene Radio ( am I allowed to mention that?) on 13 Dec.
Will be watching how they trade on Monday.

[steve fleming]

Cheers AA.

As per BSA's presentation, BSA is significantly undervalued with respect to its peers:

June 2008
Pro forma (BSA Inc Hills)/All Ords/Sector
P/E Ratio 10.5 16.7 18.8
Dividend Yield 7.6% 3.9% 3.9%

Last month when BSA was around 50 cents and trading on a PE multiple of about 6-7 was ridiculous.

No wonder Citigroup has an initial 93 cents target on BSA.

[Sauce]

Directors buying up. Triple M aquisition and subsequent synergies seem to be going well. Half year EBITDA up 47% and in line with market guidance.

Surely this stock is due for a re-rating soon, market conditions not-withstanding. Fundamentals look so good at the moment.

Not suprised the directors are diving in. I have been snapping up the odd parcel myself. Good things in store for BSA shareholders in the future.

Regards,

Sauce

[steve fleming]

Directors buying up. Triple M aquisition and subsequent synergies seem to be going well. Half year EBITDA up 47% and in line with market guidance.

Surely this stock is due for a re-rating soon, market conditions not-withstanding. Fundamentals look so good at the moment.

Not suprised the directors are diving in. I have been snapping up the odd parcel myself. Good things in store for BSA shareholders in the future.

Regards,

Sauce

Agree Sauce.

In FY09 BSA sales are estimated at $300m+, on just under a 10% EBITDA margin.

A market cap of $108m gives plenty of upside – as it is currently trading on about 4-5 times FY08 EBITDA.

Dividend yield of 7%.

Citi has an initial 81c price target.

[Sauce]

Hi Steve,

No update on the Hills proposal yet.

Where do you get 300m revenue from steve? I thought current FY forecast was revenue of 255m without Hills or 370m including three months of (proposed) Hills revenue?

I havent had time to try and decipher the presentation yet so looking forward to independant report. From memory shareholders get a fair wack of cash back in exchange for dilution of shareholding. BSA adds 7-8m to NPAT through aquired antenna business. Hills end up with majority 51% shares in BSA. New chairman. New synergies etc.

Any thoughts on the proposals benefits for BSA shareholders steve?

Regards,

Sauce


Agree Sauce.

In FY09 BSA sales are estimated at $300m+, on just under a 10% EBITDA margin.

A market cap of $108m gives plenty of upside – as it is currently trading on about 4-5 times FY08 EBITDA.

Dividend yield of 7%.

Citi has an initial 81c price target.

[Sauce]

Woops sorry i see now. FY09.

[steve fleming]

Hi Sauce,

Since HIL were unable to get their capital raising away, they will have to rely on their SPP to fund the BSA acquisition...the dates for the SPP haven't been set yet...so the BSA deal is still some time away.

However the comments below from the HIL MD indicate that the merger and combined entity going forward makes a lot of sense.

cheers


------------------------------------------------------

http://sa.iguana2.com/cache/a46b1397a09a5ef75a1b17014a8f362b/ASX-HIL-164350.pdf

corporatefile.com.au
In December Hills announced a conditional bid to acquire 50 percent of BSA, a
publicly listed provider of telecommunications installation services. What’s the
rationale for the acquisition and what’s the level of BSA shareholder support for
it?

MD David Simmons
We’ve known the BSA team for some time both as a customer and, on occasion, a competitor. We think the work that has been done to restore the business to
profitability and its growth prospects are both excellent. The acquisition is an
opportunity to build a significantly more diverse, vertically integrated business focused on the entertainment and telecommunications sectors. It will be a business unlike any other in the sector being integrated from engineering through to final installation.

We wouldn’t consider anything other than a friendly takeover and this transaction has the support of the BSA board, subject to due diligence. If the independent expert’s report is favourable we believe there’ll be good shareholder support for it.

[steve fleming]

http://eureka03.businessspectator.com.au/bs.nsf/Article/Hills-loses-reception-CA4VB?OpenDocument

"........The merger, which would have included a return of capital to BSA shareholders, was able to be pulled after the ASX traded 15 per cent below the pre-merger announcement levels for 5 consecutive days.

The fall had given Hills the right to renegotiate the offer, but BSA MD Mark Foley said his company did not want to do that. He said the market had not reacted favourably to the offer and disapproved of BSA as a “listed Hills subsidiary”."

BTW, an outstanding first half result for BSA.

[lissica]

I emailed the company about a month ago because of this but they never got back to me. Still, I was kind of expecting them to pull the offer because of that.

I agree with the MD that I don't want BSA to be a Hills Subsidiary, but it would be nice to have some sort of vertical integration they would have gotten with the merger.

Good numbers though. I'd top up but have too many already

[lissica]

OK just a quick tip off that BSA is now on the run again.

50c when posted

DYOR

AA

I already own too many! But the recent DRP would be at a pretty good price...I think it would pretty much increase my holdings by close to 10%.

[mark100]

Pretty big downgrade today. Could be cheap but the first downgrade is normally not the last

[skinny]

I think its pretty good value at the these levels and picked some up @31c (my first buy in a couple of months actually).

With the downgrade NPAT is expected at $9.6M for the year end June 2008 and with around 180m shares outstanding this puts eps at 5.3c and the current p/e around 6. The dividend yield is massive at 15%; even if they cut it to 3cps (i.e. they maintain the 1.5cps interim dividend expected in the announcement today) its still 10%.

Another way to look at it is with the downgrade on an eps basis they are around levels for the June 2007 year (5.7c) yet at that time the share price was around 60c. With todays announcement one can surely charge mgmt of over promising & under delivering. With the valuations as undemanding as they are now I'm prepared to gamble that things do come right in time.

[Huang Chung]

From Friday's downgrade:

.....The above slowing of revenue, on its own, did not warrant the need to provide a profit downgrade to the market, however BSA has identified a number of abnormal items that will impact the EBITDA and NPAT results to a level that requires BSA to advise the market, the abnormal items include;


The costs associated with the Hills Industries Ltd (ASX Code: HIL) unsuccessful merger and acquisition transaction;

Obsolete inventory write offs not previously identified in prior years; and

Higher expenditure and lower revenues realised by the business relating to the launch of FOXTEL’s new Subscriber Management System.

Released only 5 weeks earlier, BSA's investor presentation gave no real hint of trouble.

Interestingly, the Hills merger was called off before BSA released their investor presentation, but there was no mention in it about the costs associated with the called off transaction.

Looks like Hills got the get out of jail free card......wonder if they didn't like what they saw doing their DD?

Of couse, if Hills like the underlying business, they might come back with a takeover bid.....

[steve fleming]

From Friday's downgrade:

.....The above slowing of revenue, on its own, did not warrant the need to provide a profit downgrade to the market, however BSA has identified a number of abnormal items that will impact the EBITDA and NPAT results to a level that requires BSA to advise the market, the abnormal items include;


The costs associated with the Hills Industries Ltd (ASX Code: HIL) unsuccessful merger and acquisition transaction;

Obsolete inventory write offs not previously identified in prior years; and

Higher expenditure and lower revenues realised by the business relating to the launch of FOXTEL’s new Subscriber Management System.


Released only 5 weeks earlier, BSA's investor presentation gave no real hint of trouble.

Interestingly, the Hills merger was called off before BSA released their investor presentation, but there was no mention in it about the costs associated with the called off transaction.

Looks like Hills got the get out of jail free card......wonder if they didn't like what they saw doing their DD?

Of couse, if Hills like the underlying business, they might come back with a takeover bid.....





Yeah good point HC.

BSA really should have quantified the extent of the abnormals vs the operational factors that led to the downgrade.


The thing is, the market is now pricing BSA at the same levels it was when BSA was just breaking even - now it is generating NPAT of approx $10m.

Trading on approx 3 x EBITDA - for a well run and managed, reasonably substantial and growing industrial, that is just crazy stuff.

The market is absolutely unforgiving at the moment - any excuse to punish it will take.

[brisand]

CBA now major shareholder

[zac]

Is CBA an investor or a holder of a margin loan security?

[skinny]

I think its pretty good value at the these levels and picked some up @31c (my first buy in a couple of months actually).

With the downgrade NPAT is expected at $9.6M for the year end June 2008 and with around 180m shares outstanding this puts eps at 5.3c and the current p/e around 6. The dividend yield is massive at 15%; even if they cut it to 3cps (i.e. they maintain the 1.5cps interim dividend expected in the announcement today) its still 10%.

Another way to look at it is with the downgrade on an eps basis they are around levels for the June 2007 year (5.7c) yet at that time the share price was around 60c. With todays announcement one can surely charge mgmt of over promising & under delivering. With the valuations as undemanding as they are now I'm prepared to gamble that things do come right in time.

Now @45c, a 45% return in a week ;-)

[winner69]

Amazing - issue a profit downgrade and watch the shares go up!



...... and another profit downgrade and down she goes .... back to the low 20's

Worth noting Steve's point earlier in that the market is pricing it at less than it was when it barely breaking even but even after the downgrade still going to make $8m NPAT

But Steve also said the market is unrelentng these days .... ad today was not a good day to put out such an announcement

[steve fleming]

Worth noting Steve's point earlier in that the market is pricing it at less than it was when it barely breaking even but even after the downgrade still going to make $8m NPAT


Yep...Just shows the difference between the market today and the market 18 months ago.....the growth premium has been completely wiped out...its all about risk now.

[skinny]

Risk is pretty contained I'd say -- they have very little long-term debt on the balance sheet, labour and other fixed costs are a small fraction of operating revenues, and the present share price its trading at the book value of the asset base.

I bought another 80k this morning as part of my slow rotation out of energy stocks. The profit guidance update yesterday puts them on a p/e of around 5 and re-call that some of the lower profit forecast for this June year are costs associated with the aborted Hills take-over.

Its gone from being a small cap growth stock to extreme value stock in a very short period of time! I think its an easy 50% gain from this point for the patient (to bring their p/e back to more normal industry levels) and perhaps a multi-bagger if they are able to resume their growth path over 2009 forward. Management at least still expects good growth and have been backing this up by buying the stock on market all through the last month.

[skinny]

Thanks for the Citi outlook. Not a paragon of credibility but even so could you post their analysis if you have it? Playing round with revenues and margins in the business segments I think they're being very pessimistic with regards FY09 earnings - given a large fraction of the reveneus are locked in it would imply a massive contraction in margins to well below sustainable levels. This could happen but unsustainable things by definition don't last!

Anyways, certainly the outlook over this year and perhaps next is much less rosy than what mgmt were promising at the beginning of the year. My judgement is that this is just a classic case of a relatively high p/e growth stock being severly punished for over-promising in a very unforgiving market. Now I've got a reasonable stake in it I'll start pestering investor relations to better understand revenues and margins in the business segments!

[skinny]

Don't worry Skinny, Citi released that with a motive.

I will let you glue Two and Two together,

AA

In my present position I couldn't possibly comment. But the thought did cross my mind.

[mark100]

Another Robbo ramp. Short term gain long term pain like the majority of his ramps

[mark100]

Who is the horses mouth? speaking to Mark Foley I got the impression sales were now building momentum after a disappointing period?
Should I phone him back and grill him some more?

Agree Mark100 where is Robbo now? But I can't really blame him, I was Naive I take all the blame. I'm not sure he knew better. Id like to believe he was a genuine good guy who make a mistake, he was betting on telstra....hindsight. I was one of his suckers. I admit it. Live and learn.

Robbo was a skilled fundamental investor, I do believe that, but there were a few cloaks, the true pain of BSA has hurt me and my family/friends really bad.Very Hard earned money has been lost.

It makes me very sick even now, I have to live with it on my shoulders my advice to others keeps me awake at night. I am paying back every cent for my foolish advice to others, I feel it is my responsibility.

I've only ever made money on my own decisions, bloody brokers advice cost me too...

With all I've learnt, I'm only just surviving in this market, treading water at the moment, any advice Mark100 to move forward?

Mark100 I'd like you to step up, and guide others here, the newbies, criticism of others from the back benches does little good unless you offer a solution. However I see your insight.

AA



My advice to the newbies AA is to not get sucked in by persuasive posts with high price targets such as those Robbo made. I lost relatively small amounts on NHE/GLX and BRO but they were my only Robbo related losses from memory. Newbies need to do their own research and be aware that most posters on sites like these are looking to make money for themselves.

I have my doubts about Robbo's skill as a fundamental investor. However he was very skillful at finding short-term plays where there would be some news flow and then ramp it very hard. Funny how he always told people not to sell but I'm sure he would have been dumping into share price strength.

My portfolio is treading water as well however I am only 20% invested and have been that way for quite some time. Of that 20% invested around 70% is in energy for the time being.

My view is we may have a small relief rally in the short term but there is a bit more downside to come. Maybe another 10% down from here before we start to form a bottom. I don't expect a sharp recovery. I reckon it could take 5 or more years to reach the old high. Small cap industrials will probably take longer to find a bottom although many have already been smashed.

I used to give my friends a few tips but the problem is they are unsophisticated investors looking for an easy buck. Then when the news turns bad or its time to lock in a profit they don't want to sell and they end up losing out. So now I don't even mention shares to my friends (otherwise I might end up with none!)

[Packersoldkidney]

I don't know if Robbo was genuinely malicious - but he certainly made a mistake by posting price targets, etc. The fact I can recall this habit of his three years or so after the fact made it stick out. We have no proof that he was offloading any stock at the same time as others were buying stocks that he was 'ramping'.

I don't think you can influence a stock's price all that much by posting on a website - the stock would have to be highly illiquid for that to happen.

It's a fact, however, that posters on this site with the best records of picking winners, usually do so by posting very little information on that stock. The poster named Miner, by a very very long way, has the best record of picking winners on the ASX since I've been involved with this site. He picked Paladin when it was under 2 cents a share, QGC when it was a fraction of what it is today, and many others - saw his name on the MNM thread recently and when I looked at the chart I realised he'd picked it well before it launched. And he doesn't come up with elaborate posts to justify his picks, either. Like everyone on this site he has had a share of duds, its just that his hits far outweigh his misses.

As for fundamental investing: I can't see how it is very helpful - I've only found use for it in judging general market conditions, certainly not specific stocks - for a start you are relying on a premise that a company is being truthful with its figures, which often is not the case. Technical analysis is far better in judging specific stocks and general market conditions in my experience, but that argument has been dug over on this site like a pharoah's tomb, so I won't dig it up again.

[mark100]

I know of at least one occasion on a non-public forum where he ramped a stock and then a few days later after it dropped claimed to have sold. The stock was ITC. After that my small amount of trust in him vanished.

I can also recall occasions where some of the trades he claimed to do just wouldn't have been possible when compared with the on-market volume.

Anyway sorry to clog up the BSA thread

[skinny]

Robbo and his ilk are on every share trading board I have visited. If nothing else he stimulated a lot of interest and debate and was generally entertaining with it. The stocks he touted where generally small caps with growth potential - high risk and high reward stuff. As usual, doing your own DD and limiting any of the picks to a small fraction of would have helped avoid downside risk.

Turning to BSA I liked the growth story here but never bought in until it was well off the highs as in part I couldn't see the high p/e multiple being justified and in part there were much more compelling uses for my capital elsewhere. But I could understand the case for those that did and what I think must me remembered in this case is that everyone[/U] has been caught by surprise by the the profit downgrades - including mgmt if their earlier enthusiastic purchases of the stock are anything to go by. That is a bygone, the judgment one has to make now is whether the market has over reacted or not to it.

Anyways, my 3yr old is bugging me to play so off I go :-)

[Huang Chung]

Going back and reading the first page of this thread is interesting indeed.

Robbo was history for me after the lashing I copped by daring to question why BSA might get to 85c by the end of the week (a gain of some 40% in a couple of days).

Having said that, he did draw my attention to Austin Engineering, and I made a little bit on that stock.

Just like everybody else, he picked some winners and some losers....but the cult status he picked up around here was something else. :confused:

[crunch]

Did anyone go to the AGM or have any feedback.
Regards

[crunch]

This Co is about to add a good sized Company to its portfolio which should complement Triple M nicely. It has paid a div and was profitable in the last difficult year.
What are others thoughts?

[steve fleming]

This Co is about to add a good sized Company to its portfolio which should complement Triple M nicely. It has paid a div and was profitable in the last difficult year.
What are others thoughts?

The thing that interested me was the purchase price ($13m) relative to the turnover of $110m.

Assuming the acquisition was on an EBITDA multiple of 5 to 6, this implies an EBITDA of $2m to $2.5m, and therefore an EBITDA margin of about 2%, so very low margin.

However, in any event it should provide some nice scale for BSA.

Annualised revenue at about $350m now. At an EBITDA margin of 6.5% = approximately $23m.

Current Market cap = $60m.
Net debt = $20m
EV= $80m

So trading on an EBITDA multiple of under 4 - so due a re-rate you would think.

[crunch]

There is a good vote of confidence with Ross Johnston buying a few extra shares.

[buns]

Really taking a thrashing now, no depth at all, could hit 10c

[ormond]

Really taking a thrashing now, no depth at all, could hit 10c

What a ridiculous ill informed statement you've just made.
One trade of $2400 and you think the shareprice is going to fall of the cliff.
Very illiquid dividend paying stock and looks excellent value.

[lissica]

What a ridiculous ill informed statement you've just made.
One trade of $2400 and you think the shareprice is going to fall of the cliff.
Very illiquid dividend paying stock and looks excellent value.

Not to mention more director buying in the last few weeks

[buns]

What a ridiculous ill informed statement you've just made.
One trade of $2400 and you think the shareprice is going to fall of the cliff.
Very illiquid dividend paying stock and looks excellent value.

Sorry bud, just glanced at the thing and thought off the top of my head that last time (months and months ago), this thing had strong depth was more liquid. Surprised though, Farley old and well known company now (it seems), returning a dividend, figured it would be more liquid, and not in a position where one small/medium sized sell order could half it's SP.

[Lizard]

Looked like a fairly solid result with a "solid" outlook statement.

Seems fairly cheap at current levels (23cps), as PE 8.5 and forward PE perhaps under 7 if it is possible to annualise for Allstaff acquisition? Though the bumpy contracting revenues are hard to predict without knowing the company well. P/S 0.15, so very cheap on a revenue basis - but that's no help if margins are still on the squeeze.

Could be worth a punt. I have on watch for now.

[Lizard]

Hasn't done much over the last year in share price terms (now 24cps) or in NPBT. As expected, building services revenue up but contracting down and quite a bit of pressure on margin. Big gain is in the cash position, which has turned around to net cash of $8.7m, though largely seems to have come from creditor financing as payables have increased much faster than receivables. As a result, EV/EBIT currently sits at a low 4.25.

The good news is probably the 1cps special div, bringing total divs to 3cps for the year. Outlook statement looks promising, but given low margins, difficult to count on at this stage. I bought a few recently at 21cps, but probably not for the long term.

[Lizard]

Put a bid on for some more of these this morning, but have just got back to the computer and find I'm left in the dust.

I doubt this is quality, but it takes only a half decent result to make this one stack up at these prices, so I hold a few (and was hoping to hold a few more, going into half year. Such is life.) Anyway, back up to 23cps, so we will see if they can come in with a solid half year and div to support it in Feb. They certainly look cheap on an EV/EBIT basis, but very low margin parts to this business make it a hard one to call.

[soulman]

Yeah, unlucky Liz. 11th of Jan was the volume signal for today's action.

BSA has paid a decent dividend all these time from GFC to now. Last report stated they has a net cash position.

[Lizard]

A good half year result this morning and a bit of a boost here to 27cps. Sticking with the 1cps div and sounds like second half revenues will be somewhat lower, but still looks cheap at these prices.

Hoping to ride this to 35cps ish, but will see how it goes.

[h2so4]

I agree Liz, looks cheap, bought in on the good result.

[Joshuatree]

Back to 22c on no news that I'm aware of.Very good div if maintained but maybe not a quality defensive stock to ride out in.

[h2so4]

Maybe but there is enough noise around at the mo to sink any boat.

[Joshuatree]

Latest update and some are reading falling profits and bailing, suggesting a deceptive update. i thought it was predicting a slight drop but others more forensic know better it seems. And i guess one can't assume BSA will pick up business on Hasties demise.

[soulman]

Seems like a decent result and finish the year with net cash position of $9.5 mil.

Going ex-div today of 1 cents and yielding at near 10%FF at current prices.

[Lizard]

Finally bailed on this at 18.5cps with little to show for the trade bar the dividends. May try again another time, but the agm does not presage a great year. Perhaps should have held on for an announcement re the large contract they foreshadow, as perhaps that will give some a better out

[steve fleming]

Dividend cut by 50%

As much as they have tried to diversify, BSA remains a cyclical play on commercial construction activity, which doesn't look like picking up to 2014 at least.

[steve fleming]

Dividend cut by 50%

As much as they have tried to diversify, BSA remains a cyclical play on commercial construction activity, which doesn't look like picking up to 2014 at least.

BSA's (earnings) results were in line with guidance.

The big negatives here (which gave impetus to the fall) were the big step up in debt, the negative cash flows and thus the cut back in the dividend (of which there was no previous guidance on).

There is (at least on my part!) a tendency to ignore the balance sheet implications of an earnings downgrade/ guidance, but particularly in the case of a low margin business/working capital intensive business such as BSA, companies should be providing guidance on these cash/debt metrics (instead of just earnings); as these are often of a more material nature than traditional earnings.