SML - Synlait Milk Ltd

[ratkin]

That was crafty and very good spotting

It was a big deal around Ashburton/Chch at the time, they were looking for a ton of workers and team leaders as
were setting up extra shifts, they were desperate for staff as had to make huge ramp up, It was clear they were
going gangbusters down there.

[BlackPeter]

Good company, but looks like the SP got ahead of its value. Today so far 30 cents down. Who wants to catch the falling knife?

[Absolute144]

Synlait delivering on growth strategy and reports $38.2m

8:30am, 19 Sep 2017


Synlait (NZX: SML; ASX: SM1) has reported their strongest performance yet with a net profit after tax of $38.2 million, double digit growth in profit margins and revenue increasing 39% to $759 million.


“Our shareholders supported this growth focus in September 2016 when we successfully raised $97.6 million to invest in our business,” said Graeme Milne, Chairman.


Mr Milne said Synlait’s current balance sheet is in a very good position with net debt down from $214 million to $83 million, and along with retained earnings, the company is in a good position to fund its growth strategy.


My Question is....
Revenue 759 mill
Debt 83 mill - what did they pay the 131 million of debt off with (the capital raise of 97 million + earnings or did they pay it off with more earnings and invest the majority of the 97 million in another drying tower???)

[Nasi Goreng]

Synlait delivering on growth strategy and reports $38.2m

8:30am, 19 Sep 2017


Synlait (NZX: SML; ASX: SM1) has reported their strongest performance yet with a net profit after tax of $38.2 million, double digit growth in profit margins and revenue increasing 39% to $759 million.


“Our shareholders supported this growth focus in September 2016 when we successfully raised $97.6 million to invest in our business,” said Graeme Milne, Chairman.


Mr Milne said Synlait’s current balance sheet is in a very good position with net debt down from $214 million to $83 million, and along with retained earnings, the company is in a good position to fund its growth strategy



My Question is....
Revenue 759 mill
Debt 83 mill - what did they pay the 131 million of debt off with (the capital raise of 97 million + earnings or did they pay it off with more earnings and invest the majority of the 97 million in another drying tower???)

They increased their cashflow in the year so that was used to pay off debt. The capital raise money has not yet been spent so therefore it reduces debt for now, and debt will increase again when they do spend it.

[BlackPeter]

Not sure what the point is to discuss what money they used for repaying debts and what money for new acquisitions?

Sounds as sensible as discussing which of the $20 notes in your wallet you used to pay the butcher and which to pay the baker ...

Fact is that their debt did reduce drastically (which is good) and they still did spend money for new acquisitions. I suppose this new factory in Auckland was not for free?

Well done Synlait - even if I feel that the SP is currently a bit frothy ... but you can't blame Synlait for that ...

[Absolute144]

I also run a business. A good money manager knows where his/her money is going....

[BlackPeter]

I also run a business. A good money manager knows where his/her money is going....

That's not the point. Just read SML's report and you know that they know where their money is going.

The question was "Revenue 759 mill
Debt 83 mill - what did they pay the 131 million of debt off with (the capital raise of 97 million + earnings or did they pay it off with more earnings and invest the majority of the 97 million in another drying tower???)"

My point is that it is completely immaterial whether they used the money from the CR for repaying debts or a new acquisition. They did both. How would anybody distinguish which money they used for which purpose - and why would this be relevant?

[Hectorplains]

That's not the point. Just read SML's report and you know that they know where their money is going.

The question was "Revenue 759 mill
Debt 83 mill - what did they pay the 131 million of debt off with (the capital raise of 97 million + earnings or did they pay it off with more earnings and invest the majority of the 97 million in another drying tower???)"

My point is that it is completely immaterial whether they used the money from the CR for repaying debts or a new acquisition. They did both. How would anybody distinguish which money they used for which purpose - and why would this be relevant?

This is a peculiar discussion.

Up 43c today, nudging closer to $7...white oil rush!

[hardt]

After being an idiot and cutting my holding in half at $6... I topped up again this morning.

Forward PE of 20* seems more than reasonable given the industry and how it is expected to move over the next 5-10 years.

[hardt]

I am continuing to buy while it remains under $8