sharetrader
Page 1 of 54 123451151 ... LastLast
Results 1 to 15 of 801
  1. #1
    Share Collector
    Join Date
    Mar 2005
    Location
    Porirua
    Posts
    3,866

    Default Skellerup (SKL) Fundamentals

    New thread to separate from the chart view.

    One thing worth noting re SKL fundamentals is the comment in the Chairman's notes that states "...its (the Industrial division) EBITDA is anticipated to increase to approximately 60% of group EBITDA in the 2007 year".

    This statement is significant. Last year, agri provided $16m EBITDA and industrial $17m. Now, unless agri is shrinking, this is a substantial change. Based on agri remaining constant, a 60% contribution from industrial would indicate EBITDA of $40m - a $7m or 21% increase on prior year. A small amount of growth in agri to $16.5m would indicate EBITDA of $41.3m, or a 25% increase.

    While interest expense is likely to increase, an estimated increase in interest cost of $2.5m would still see an increase in NPAT of $3 - $4m, taking NPAT to $16.4-$17.4m. Allowing for some dilution from the DRP, this would put them on a forward P/E of 8.8 - 9.3 at current share price of $1.44.

  2. #2
    Share Collector
    Join Date
    Mar 2005
    Location
    Porirua
    Posts
    3,866

    Default

    It always seems that the number of responses is inversely proportional to the time spent researching a post. Before I go off for an extended sulk, I shall give myself a response.

    1. Is the company being unrealistic in their figure of 60% EBITDA from industrial? Possibly. But last year industrial had organic growth of 16% ($11m revenue). The remaining $24m revenue increase came from acquisitions. However, the major acquisition, Gulf Rubber, was included for only 5 months of operations. I estimate that Gulf Rubber should therefore contribute at least a further $20m to revenue for this year. An additional 16% organic increase would bring industrial revenue to $140m. Using the same EBITDA margin as for 2006 would give industrial an EBITDA contribution of $23m - a $6m increase over 2006 (c.f. the $7m calculated from the Chairman's comments).

    2. Why aren't analysts calling this? Analysts appear to me to be low-balling either the revenue projections or margins or both. Reports I have seen have given revenue of $186 - $189m, c.f. my calculation giving $195m. This means they can produce a result which shows a conservative NPAT growth in line with past years.

    3. How risky is this? Very. Forex and raw material prices can swing things quite markedly. Comments at this afternoons AGM should give some better guidance, so safer to wait .


  3. #3
    Senior Member
    Join Date
    May 2005
    Location
    anzac
    Posts
    1,210

    Default

    quote:Originally posted by Lizard

    It always seems that the number of responses is inversely proportional to the time spent researching a post. Before I go off for an extended sulk, I shall give myself a response.

    1. Is the company being unrealistic in their figure of 60% EBITDA from industrial? Possibly. But last year industrial had organic growth of 16% ($11m revenue). The remaining $24m revenue increase came from acquisitions. However, the major acquisition, Gulf Rubber, was included for only 5 months of operations. I estimate that Gulf Rubber should therefore contribute at least a further $20m to revenue for this year. An additional 16% organic increase would bring industrial revenue to $140m. Using the same EBITDA margin as for 2006 would give industrial an EBITDA contribution of $23m - a $6m increase over 2006 (c.f. the $7m calculated from the Chairman's comments).

    2. Why aren't analysts calling this? Analysts appear to me to be low-balling either the revenue projections or margins or both. Reports I have seen have given revenue of $186 - $189m, c.f. my calculation giving $195m. This means they can produce a result which shows a conservative NPAT growth in line with past years.

    3. How risky is this? Very. Forex and raw material prices can swing things quite markedly. Comments at this afternoons AGM should give some better guidance, so safer to wait .

    OK, LIZ the true story is every one looks at it and NO one BUYS it such a boring stock is a great candidate fore TAKEOVER.. [8D]

  4. #4
    Member
    Join Date
    Dec 2004
    Location
    Auckland
    Posts
    88

    Default

    I held this for sometime, and got out for frankly psychological reasons. Far from being boring, I felt that management had an appetite for risk which was out of step with the sort of business that this is. They also seem to be hoping that macroeconomic conditions move in their favour. I am watching and if they start to demonstrate that they can actually produce consistently improving results, then I'll be onboard.

  5. #5
    Reincarnated Panthera Snow Leopard's Avatar
    Join Date
    Jul 2004
    Location
    Kuching
    Posts
    379

    Default

    What are the actual details of this reported $4m hit when currency cover runs out?
    om mani peme hum

  6. #6
    Share Collector
    Join Date
    Mar 2005
    Location
    Porirua
    Posts
    3,866

    Default

    Hi PT. I'm a bit surprised at the size of that! From memory, I thought the cheap currency cover fell away more gradually and ran out completely in early 2007. An amount of that size off the bottom line certainly puts a dent in my analysis. Seems the company is forecasting to still grow NPAT, despite the forex hit, but only by an amount similar to last year.

    Still think SKL will work out as an investment, but less enthused than I was.

  7. #7
    Share Collector
    Join Date
    Mar 2005
    Location
    Porirua
    Posts
    3,866

    Default

    SKL looking good today with close at $1.60 and a dearth of sellers. Has also paid a 5cps dividend since my post of a few weeks ago.

    In true forum style, I should now point out (after the fact) that I bought more at $1.46 the day after my initial post...

    ...and am about to go spend the dividend on patagonian toothfish with miso sauce for mothership's belated birthday celebrations!

  8. #8
    Junior Member
    Join Date
    Sep 2006
    Location
    Wellington, New Zealand.
    Posts
    16

    Default

    Bless you my child - I was not really looking forward to the KFC

  9. #9
    Member
    Join Date
    Nov 2003
    Location
    Wellington
    Posts
    129

    Default

    Lizard, how do you feel about their debt levels? I was initially interested in SKL, with their high ROE and reasonable dividend, but that ROE is really the result of some substantial leverage. This leaves me wondering how they would do in a bad year.

  10. #10
    Share Collector
    Join Date
    Mar 2005
    Location
    Porirua
    Posts
    3,866

    Default

    The ROA still looks good though. So debt pays off. But still need to see how that looks without the hedges...so I am non-committal [8)]

    (DRP is a good move in that regard though)

  11. #11
    Member
    Join Date
    Mar 2006
    Location
    Timaru, , New Zealand.
    Posts
    39

    Default

    This Happy Camper is very pleased with the recent run up in the share price.

    I calculate that around 2% of the company has changed hands in the past month. I would be keen to have someone with access to raw data confirm
    a) my crude 2% calculation
    b) the normal range of %age churn per month for SKL over the past year or so

    Cheers

  12. #12
    Member
    Join Date
    Jun 2005
    Location
    Marlow, , United Kingdom.
    Posts
    136

    Default

    I have held SKL (SKX) for 2 years now on the basis it has been undervalued. However, I am not sure what has changed to increase the price. Nothing much has changed except that the business model is proving robust with good consistency in earnings.

    Maybe there is an undercurrent or whiff of a takeover in this price ramp up. But I would not expect earnings to significantly increase (nor decrease) so not sure what is happening here.

  13. #13
    Senior Member
    Join Date
    Sep 2004
    Location
    Fukuoka, , Japan.
    Posts
    732

    Default

    Supposedly it has quite an open register so it would be quite easy to takeover should someone want to.
    \"The overweening conceit which the greater part of men have of their own abilities [and] their absurd presumption in their own good fortune.\" - <b>Adam Smith</b> - <i>The Wealth of Nations</i>

    The information you have is not the information you want.
    The information you want is not the information you need.
    The information you need is not the information you can obtain.
    The informaton you can obtain costs more than you want to pay.

  14. #14
    Member
    Join Date
    Mar 2006
    Location
    Auckland, New Zealand.
    Posts
    275

    Default

    quote:Originally posted by Base Trader

    I have held SKL (SKX) for 2 years now on the basis it has been undervalued. However, I am not sure what has changed to increase the price. Nothing much has changed except that the business model is proving robust with good consistency in earnings.
    If you have thought that the company was undervalued for the past couple of years, perhaps other investors have come to the same conclusion - and pushed up the price. That was my reason for buying in August.

  15. #15
    Member
    Join Date
    Mar 2006
    Location
    Timaru, , New Zealand.
    Posts
    39

    Default

    This Happy Camper considers that at $1-60 this share is fully valued. Having said that, private equity players have been confounding me of late with the premiums they have been paying when acquiring quality stocks.

    SKL still deliver a respectable div yield at these prices, so this Happy Camper intends to hold until the SSH picture becomes clearer - I anticipate that will be later this year or early next.

    Cheers

Tags for this Thread

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •