MPG - Metro Glass

[JeremyALD]

https://s3-ap-southeast-2.amazonaws....073/264199.pdf

Page 5 clearly says N.Z. sales have been flat, (not group sales). I think the analyst who commented on NBR that this was very poor has misinterpreted this as sales for the company overall are flat and made the comment that this was poor because of the expanded size of the group including the Australian operation.

It said NZ revenue is flat is YOY but group results are expected to be similar to first half of last year. I think we can take from that AU results will be pretty flat as well and we'll run to a similar NPAT result as the first half of last year.

Not all that bad really. This company is still learning and it's going to take a while for them to optimise operations.

[winner69]

https://s3-ap-southeast-2.amazonaws....073/264199.pdf

Page 5 clearly says N.Z. sales have been flat, (not group sales). I think the analyst who commented on NBR that this was very poor has misinterpreted this as sales for the company overall are flat and made the comment that this was poor because of the expanded size of the group including the Australian operation.

I think Metro are creating the confusion themselves ...maybe a good ploy

Best result probably is Groups half year to be similar to last year (which only had 2 months AGG)

Your guess as good as mine

The Chair address mentioned both NZ sales and Group results -

Given the current conditions we are seeing in the market, we expect the Group’s first half results to be similar to those achieved in the first half last year, which was a particularly strong half. Activity levels to date have been below our expectations and as we had resourced the business accordingly there will be a need to adapt and pursue efficiency initiatives through the second half of the year

[Beagle]

It said NZ revenue is flat is YOY but group results are expected to be similar to first half of last year. I think we can take from that AU results will be pretty flat as well and we'll run to a similar NPAT result as the first half of last year.

Not all that bad really. This company is still learning and it's going to take a while for them to optimise operations.

Yeap, agree and I finally joined the dots...must have been having a "senior hound" day yesterday lol
If they get beaten down heavily from here (perhaps as a result of exiting the NZX50) I might dip my paw in the water for a few more but I am not a buyer unless they're at a discount of at least 10% discount to my valuation above. $1.00 might get the hound joining in the hunt with more enthusiasm.

[percy]

Yeap, agree and I finally joined the dots...must have been having a "senior hound" day yesterday lol
If they get beaten down heavily from here (perhaps as a result of exiting the NZX50) I might dip my paw in the water for a few more but I am not a buyer unless they're at a discount of at least 10% discount to my valuation above. $1.00 might get the hound joining in the hunt with more enthusiasm.

Maybe time for you to revisit being a disciple of KW.
Renew your vows of never buying a stock in a down trend.
Old dogs should just try to keep up with old tricks,which work.!!..lol.

[Beagle]

I think Metro are creating the confusion themselves ...maybe a good ploy

Best result probably is Groups half year to be similar to last year (which only had 2 months AGG)

Your guess as good as mine

The Chair address mentioned both NZ sales and Group results -

Given the current conditions we are seeing in the market, we expect the Group’s first half results to be similar to those achieved in the first half last year, which was a particularly strong half. Activity levels to date have been below our expectations and as we had resourced the business accordingly there will be a need to adapt and pursue efficiency initiatives through the second half of the year

Thanks mate. One wonders what they're inferring by this ? Is that what has the market spooked ?

[winner69]

It said NZ revenue is flat is YOY but group results are expected to be similar to first half of last year. I think we can take from that AU results will be pretty flat as well and we'll run to a similar NPAT result as the first half of last year.

Not all that bad really. This company is still learning and it's going to take a while for them to optimise operations.

Group flat = AU up (6 months v 2 months) and NZ down (for second half year in a row)

[BlackPeter]

Fair enough BP, I stand corrected...I did say it wasn't going to get the full Beagle work over, (such a small stake for me).

What is your take on what they said at the annual meeting, Sales flat for N.Z. operations or sales flat for the group, (inclusive of Australian operations) ?
It would appear an analyst on a behind the paywall article on NBR has taken a view that sales for the group are flat overall compared to the same period last year ?

Is this what they really said ?

Good question. I haven't been at the AGM (I think this question certainly would have warranted a request for clarification), but just reading their outlook - I guess the first bullet seems to only talk about NZ being flat (i.e. Australia should be separate):

While we remain optimistic on the medium term picture, activity levels in New Zealand have been soft
so far this financial year, with revenue growth in the first four months being relatively flat, including
continuing declines in Canterbury

While the second point seems to talk about the overall group performance for the first half year:

Given the current conditions we are seeing in the market, we expect the Group’s first half results to be
similar to those achieved in the first half last year, which was a particularly strong half.
...

Putting one and two together does not really seem to work ...

Obviously - the third bullet talks about the expectations of 2018 full year results being better than 2017 ... however coupled with a get out of jail card which the cynics under us might read as "it will not happen".

We said in the 2017 Annual Report that we anticipate improved results in the 2018 year, which we
continue to anticipate, but this will be dependent on any adverse changes in market conditions. We will
further update investors with our expectations for the full year when we release our half year results in
November

Maybe I just send an email to their investor relations manager .... happy to update this forum if & when I get a response (I suspect I will ...).

[winner69]

Not all that bad really. This company is still learning and it's going to take a while for them to optimise operations.

Cmon Jeremy - Metro have been around for decades and been learning all those years

I remember back in 1977 while on a trip to the UK looking at some optimsation software for them (or the comopany now known as Metro) to maximise the amount of different size orders that could be cut from a big sheet of glass ....and bought it back and installed it. made a big difference to the left overs that used to go in the waste bins.

Always looking for efficiencies and ways to increase productivity - nothing new - almost a necessity to stay in the game


And most of any gains end up as cheaper product for the end user

[Beagle]

Thanks BP I think between us we have this pretty well sorted out now and I doubt that investor relations will give any further expansion...but I agree that the statement at first glance could have created confusion, it certainly did for me but I was probably having a senior dog day yesterday.
This is a classic case of those who attended the annual meeting would have got more detail than the official speech notes.
it is a cyclical industry so I am happy with my PE of 10 above and valuation of $1.15 but happy for you if you want to assume some growth in the years ahead, (they do say new plant will give new manufacturing efficiencies from FY19), maybe boost their EDITDA margin up to 20% from 18.3%, that would be nice and could add ~ $3m after tax to earnings.

[BlackPeter]

BP - 2012 was the bottom of the cycle for Metro

Proforma eps for 2008 is about 10/11 cents .....9 year CAGR is ?

Dangerous to look at half cycles - need to look at a complete cycle

Liquidators report of March 2012 makes interesting reading .....but that's another story

Interesting - where did you find the 2008 EPS (they haven't been listed at that time)? I agree however, IF this number is real and comparable, than my theory of EPS growth might need some revisiting ...