WDT - Wellington Drive Technologies

[jonu]

Youch, bought in last week as I keep thinking companies like this are a bit cheap at the moment, I need to learn from mistakes. Out of interest I did a really rough DCF analysis on WDT - from the figures I used, which are probably very wrong, it still comes out overvalued even at 11 cps (although whether DCF even applies to a company like WDT is another question).

What that outlined to me is how difficult to predict their cashflows are. I know they have a large tax offset, but maybe I'm crazy for thinking last year's positive cashflow was the first of many. From what I've heard they are a clever bunch technically, but so many companies seem to suffer from this issue of being technically good but poor finanically.

I will hold for now, but in hindsight, I think around 11cps is probably fair value.

WDT has been hovering between 11.5 and 12.5 for the last week or so. I think Level 2 will be bring another leg up as the country returns to work. I think they are well placed to ride this through and continue to build their profitability. Their main customers are in the food sector and while hospitality has obviously taken a massive hit, supermarkets have been experiencing record turnover. People gotta eat!

[Caesius]

WDT has been hovering between 11.5 and 12.5 for the last week or so. I think Level 2 will be bring another leg up as the country returns to work. I think they are well placed to ride this through and continue to build their profitability. Their main customers are in the food sector and while hospitality has obviously taken a massive hit, supermarkets have been experiencing record turnover. People gotta eat!

Yeah don't disagree with what you say jonu, but I'm still mildly skeptical. Admittedly the result last week wasn't terrible in my eyes.

[jonu]

Some stronger buying depth pushing to 12c now. Onwards and upwards to true value! (circa 15-16c IMHO)

[Ricky-bobby]

The announcement was way better than what I was expecting. I liked how it was straight to the point/this is what we are doing. I’m just going to sit and see what happens with this one..

[HITMAN]

Is this the answer to their problems.

GENERAL: WDT: Wellington Drive Technologies COVID-19 cost reductions

Wellington continues to reduce costs and manage its cashflow in response to
the impact of COVID-19 on its global customer base.

In addition to New Zealand government wage support of $434,000, the company
has received or expects to receive COVID-19 related support from other
government programmes for its international offices:
o Wellington's Australian based subsidiary is receiving Jobkeeper payments
from the Australian government for its two Australian staff members at
A$3,000 per fortnight for six months and is also expecting payment under the
Australian government cash flow boost program.
o Wellington's USA subsidiary has received US$75,000 as part of the US
Paycheck Protection Program for three of its five US-based staff members
partially funding this salary cost for eight weeks.

On top of recently announced Board fees and CEO salary reductions,
Wellington's staff have all agreed to salary reductions ranging from 25% for
senior executives to 10% for lower paid staff members. The total reduction in
fees and salaries delivers cash savings of around NZ$1.7m over the period
from 1 May to 31 December 2020. All staff related reductions are compliant
with government salary support scheme rules.

The company continues to explore further initiatives to ensure it can
effectively manage through this lower revenue period.

Wellington Chairman, John McMahon commented "The board is grateful to the
staff for sacrificing salary to assist the company in getting through the
COVID-19 related economic challenges. The board is working closely with
management to manage through the COVID-19 crisis effectively."

[Cadalac123]

Somewhat of a pointless release

[Caesius]

Somewhat of a pointless release

A positive way of looking at it is they are being proactive and reducing costs just to be safe. A negative way of looking at it is they are struggling with cashflow and are forced to start cutting. I'm leaning slightly toward the latter.

[Cadalac123]

A positive way of looking at it is they are being proactive and reducing costs just to be safe. A negative way of looking at it is they are struggling with cashflow and are forced to start cutting. I'm leaning slightly toward the latter.

Ugh. I actually really liked this company and still do but it’s painful to see how this has temporarily crippled them they were seriously doing really well.

[jonu]

Ugh. I actually really liked this company and still do but it’s painful to see how this has temporarily crippled them they were seriously doing really well.

I'm not sure how you see them as being crippled. Nothing to suggest that at all. Seems very prudent cost cutting in uncertain times to me. And it would appear without impacting productivity.

[artemis]

Vodafone focusing on the internet of things - WDT opportunity.

https://www.nzherald.co.nz/business/...ectid=12334743