MPG - Metro Glass

[Rawz]

Also keen to hear about Oz. If they can scum a million from that side of the ditch then it will be a real lift to the company. First half was $0.4m EBIT.

They said they will pay out dividends once net Debt to EBITDA was 1.5X (this is from memory, cant find it anywhere in the preso's). November half year update this ratio was 1.53, so should be in dividend country by now.

Agree with RAWZ that 2-2.5c now (cost around $4-5m) and signal more to come subject to trading conditions would be about right. This company generates a reliable $12m+ per year so very do-able and still leave room for maintenance capex and debt reduction.

You are right. Their target is 1.5x and as at 30 Sep 2020 it was sitting at 1.53x.
So I don't see why we won't get a dividend.

Going forward MPG will be generating $30m+ operating cashflows. Less $7-9m capex, less lease liabilities of $7m. Leaves $14- $16m to payout as dividends and reduce debt. And this is with Australia just on par. Imagine if their earnings continue to increase.

I'm hoping to see a $13.4m FY profit. EPS $0.072. Can currently buy this stock at $0.42. Market Cap $77m. Honestly i dont get it.

[Leemsip]

Agree. $13m+ NPAT and $14m+ FCF would be a good report. Debt down to <$40m

The cash flow will eventually turn around investor sentiment, just got to be patient

[Teatree]

Metro Glass Customer update 15 Feb 2021[3022].pdfMetro Glass Customer update 15 Feb 2021[3022].pdf
Letter recieved from Metro re there freight issues and the likely affects. I would think this applies to more than just them

[winner69]

When the pre-amble is as long as the PM's in her covid updates you know its not going to be the best of announcements

EBIT 12.8m in H1 and expect to make about 4m in H2 (v 7.3m last year)

Life still seems a struggle in Metroland

But debt still coming down - that's good

http://nzx-prod-s7fsd7f98s.s3-websit...918/340776.pdf

[Rawz]

When the pre-amble is as long as the PM's in her covid updates you know its not going to be the best of announcements

EBIT 12.8m in H1 and expect to make about 4m in H2 (v 7.3m last year)

Life still seems a struggle in Metroland

But debt still coming down - that's good

http://nzx-prod-s7fsd7f98s.s3-websit...918/340776.pdf

Yes when I started to read the waffle I was concerned.
Freight and lockdowns hurting.

[Jaa]

Have heard grumblings about this container shortage but surprised to see it affecting a company like Metro. Don't they mostly manufacture their own glass? Good news demand has increased to absorb the supply from the new guys, wonder how they are doing?

Could the decline in shipping reliability and increase in prices lead to that long forgotten thing.... inflation?

[winner69]

Have heard grumblings about this container shortage but surprised to see it affecting a company like Metro. Don't they mostly manufacture their own glass? Good news demand has increased to absorb the supply from the new guys, wonder how they are doing?

Could the decline in shipping reliability and increase in prices lead to that long forgotten thing.... inflation?

All architectural glass is imported ....it’s just processed in NZ into finished product

[winner69]

this doesn't read too good in the papers - Shares in Metro Performance Glass fell 4.5% to 42.5 cents after it warned earnings could fall as much as 24%.

When you consider second half earnings are going to be fall by about 50% things must be pretty dire over the last few months

Betcha they won't be givimg guidance for F22 in May .....just some nice words things should be better

[Scrunch]

with net debt of circa. $49m representing a circa. $18m decrease year on year

Net debt was $66.9m at March 2020 and it decreased to $51.0m by September 2020. During an unprecedented boom MPG expects, over the next six months, a further reduction of $2m to $49m.

For the full year ending 31 March 2021 Metroglass currently expects to achieve Group EBIT in the range of $16.5m to $18.0m vs. $21.8m in FY20 (restated), with net debt of circa. $49m representing a circa. $18m decrease year on year. This guidance is contingent on no new and significant COVID‐19 related restrictions being imposed in either New Zealand or Australia before year end.

The Group EBIT was $13.7m at half year (or $12.8m if an significant item gain is excluded). The bottom end of this guidance range is a $2.8m EBIT increase in the 2nd half (or possibly $3.7m). If there are further significant restrictions we could go below the bottom of this range, but ignoring this possibility the bottom end of the range is break-even over the 2nd half of the year (given net interest was $3.0m in the 1st half).

Ouch - I'm surprised the share price didn't fall more!!

[Rawz]

The update is not the greatest eh.

So they have decided to lower margins by not passing on the increased price of glass they import and freight costs to their customers. Likely to maintain market share. They have been banging on about intense competition for awhile now and guess they are defending their piece.

Likely going to see NPAT $10m-$10.5m. EPS 0.055c. P/E of 7.7

Share price will likely float around 40 cent now. A price low enough to hold long term investors in for a COVID free trading result FY22 and that ever elusive dividend. Which when it comes is going to be a nice yield of 10%