Interim seems a long time.
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Interim seems a long time.
I have used the Kippenberger stonewall to my advantage. I was going to buy a parcel of shares at the time of the last result (my first SCT purchase of the Covid-19 era), which would have been a buy price of $1.84. However the uncertainty around the result made me reduce the price I was prepared to pay. So I ended up picking up a parcel at $1.65. That equates to just above my 'capitalised dividend valuation'. But that was a 'no growth' valuation. I figured all that IP contained within SCT was worth a bit of a premium.
The Sharsies crowd seem to have taken over the market for the company today. Total turnover of $554 spread over 22 trades! That is an average trade value of just 25 bucks! Price looking weaker with a bid at $1.73. Perhaps tomorrow I will support the company -and my waistline-, by not buying lunch and instead making a 'mega-purchase' (in Sharsies terms) of SCT shares with the money saved on market!
SNOOPY
Great time for Beef Bot makers
COVID-19 meat plant map | 2020-04-22 | MEAT+POULTRYwww.meatpoultry.com › articles › 22993-covid-19-me...
Yes but it is a pity that despite the success of the automated lamb boning operation, Scott's have yet to perfect the equivalent for processing beef.
Major shareholder JBS Australia are in trouble because the Chinese have banned beef imports from their Australian plants. However, the parent company of JBS Australia, JBS USA, are also in trouble for different Covid-19 related reasons as outlined in your reference Joshuatree. I requote the JBS USA plant closures since 31st March 2020 from your reference.
March 31
"JBS USA cut production at a beef facility in Souderton, Pa., on March 31."
April 14
"JBS USA temporarily shuttered a beef production facility in Greeley, Colo., through April 24 due to an outbreak of COVID-19 among employees and the surrounding community. The company shut its beef plant in Souderton, Pa., until April 16, after previously cutting production."
April 21
"JBS USA indefinitely closed its pork plant in Worthington, Minn., due to an outbreak of COVID-19 among workers."
April 22
"JBS USA limited operations at its beef plant in Brooks, Alberta."
April 27
"JBS USA announced the temporary closure of its beef production plant in Green Bay, Wis., following a coronavirus (COVID-19) outbreak."
May 5
"JBS USA stated that it will reopen its beef processing plant in Green Bay, Wis., in phases following a coronavirus (COVID-19) outbreak."
May 7
"JBS USA reopened a portion of its pork processing plant in Worthington, Minn., with reduced staff."
May 21
"JBS Canada is increasing production at its beef plant in Brooks, Alberta. The company previously scaled down to one shift on April 22 following an outbreak of COVID-19 among employees. The plant remained open with limited capacity while a nearby Cargill plant in High River, Alberta, closed for two weeks last month. Together, the two plants process nearly 70% of Canada’s beef."
Week of June 16
"After reporting hundreds of COVID-19 cases, JBS USA beef plant in Hyrum, Utah began operating with limited capacity in mid-June, resumed full operations June 19."
It does read like JBS USA are over their worst. But with the way the USA is handling their Covid-19 outbreak, this might be only the first chapter.
SNOOPY
^Australia is going to go through a period of low processing levels (this started months ago) as favorable weather has led to herd rebuilding.
Article in the Herald .... reporting some mixed bag: Performance bad, but outlook in some areas / regions better than in others:
https://www.nzherald.co.nz/business/...=CE-TA-DND-BUS
Quote:
Scott Technology is seeing an uneven recovery in its global markets, with the Asia Pacific returning to normal more rapidly than in the US and Europe.
Still, the robotics and automation firm expects its earnings in the 12 months through August to face a material hit from the Covid-19 pandemic, including the cost of restructuring its global business.
That Herald article is pretty much a cut and paste from Scott's press release of yesterday (albeit some details, like the business outlook, have been omitted from the Herald's version).
https://www.nzx.com/announcements/355846
I was pleased the share price went up 10% following that unscheduled update, even if 5c of that rise was given back today (SCT closed at $1.75). There was nothing that surprised me in the update though.
I posted the above in July 2019, all pre-Covid-19!
From Scott's 07-07-2020 press release:
"Signing of new contracts for materials handling and logistics solutions with a large food customer in Europe." This is good, but, with the slow down in the USA, almost half of Scott's business is with the old Alvey now. This will keep Scott's Europe occupied, but with the greater disruption from Covid-19 'over there', I still expect Scott's in Europe will be loss making this year.
"Recommenced the commissioning of an appliance line for Bosch in China." - Scott's never told us commissioning had stopped. I am pleased it has now restarted.
"An agreement in China for the design and build of a new manufacturing line for one of the world’s largest appliance brands." - This is good, but it may only kick in once the Bosch appliance line is finished and will very likely flow over into the next financial year. So maybe not a great year in China for Scott's in FY2020? Hopefully not a loss, although I am not sure if Scott's have made any money in China yet (due to 'transfer pricing' (?) ).
"Ongoing interest in Scott’s 'Bladestop' technology with the recent signing of a deal for the supply of 30 'Bladestop' machines to JBS USA, the world’s largest protein producer."
It is good that JBS are continuing to support Scott's by purchasing their products. But 30 'Bladestop's are worth about: 30 x $89,000 = $2.7m. A good order. But one fully automated boning room (which does not yet exist for beef remember) would be worth around $50m. This is where the real meat industry money is, not 'Bladestop'. Nevertheless, I hope the new sales staff in the USA are able to broaden the market for 'Bladestop' in the USA over there beyond Scott's own shareholder base!
While pleased to read the announcement, I see it as a springboard into FY2021. I still expect SCT to lose money this year (FY2020).
"An agreement for an industrial automation solution for a company providing services to the defence sector."
Providing the capability for weapons manufacture? I hope not!
"Cashflow management remains a priority while demand rebuilds to pre-COVID-19 levels." - Translation: No final dividend in December.
SNOOPY
Interesting article referenced on another thread about the global robotics market.
https://asiatimes.com/2020/08/us-chi...al-robot-race/
"What about 2020? With Covid-19, it will be bad. Perhaps as bad as 2009, when the Lehman shock led to a 47% decline in total worldwide industrial robot installations. Even if installations are down by only half that amount it would still be a major setback for the industry."
"Fanuc, Japan’s top pioneering robot maker, reported a 19% year-on-year sales decline in the three months to June and is girding for a 17% decline in the fiscal year ending March 2021. This comes after a 20% drop last fiscal year."
Unlike the manufacturers referred to in that article, Scott's tend use robots from other manufacturers rather than make them. IOW Scott's expertise is in developing project solutions using robotics rather than making the building blocks for other robotic solutions providers to use. The meat industry should be well motivated to continue with their automation projects, given the spatial distancing issues that appear to have caused infections in plants in Australia and the USA. But that combined two year decline of 44% at Fanuc for the year ended 31st March 2021 is scary. That 'light on the horizon' for Scott's seems a little further away today.
SNOOPY
Good news!
FURTHER CONTRACT WIN STRENGTHENS SCOTT TECHNOLOGY’S POSITION IN MINING SECTOR
Automation and robotics solutions provider, Scott Technology (NZX: SCT), has been awarded a further multi-million dollar contract by Rio Tinto to provide and commission the equipment for a new sample preparation and analysis laboratory at the Robe Valley mine site in Western Australia.
That saves me a bit of work....was about to look up announcements to see what had driven this morning's rise. Nice to see them getting more work outside of the meat works etc.