Long term share price chart looks like the blade of one of their saws
At least it gives some hope that in future it’ll be a lot higher than 2 bucks
Next peak could be over 4 bucks
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Long term share price chart looks like the blade of one of their saws
At least it gives some hope that in future it’ll be a lot higher than 2 bucks
Next peak could be over 4 bucks
I have been a bit slack not commenting on Scotts announcement of two new materials handling contract wins in Europe, from what was the old Alvey group.
1/ Danone continues to grow with a new end of line extension of their existing palletising installation for their Poland plant (operations in Poland focus on the production and distribution of dairy products, plant-based foods, and beverages). This project will automate palletising for four existing production lines and one new line ,incorporating several Scott Pal 4.0 high-speed palletizers. Additionally, the project includes repurposing existing empty and full pallets transport into the new architecture.
2/ Cranswick Food -Meat. A case sortation system will deliver carton cases to freezer locations within Cranswick’s production facilities at its Hull facility. The second stage of the project sees the palletising and wrapping of shipments ready for delivery out to customers
"These agreements, totaling $19M NZD (€11M), underscore our capability in deploying sophisticated automation systems in a wide range of industries. The revenue from these contracts will primarily be recognized in the fiscal year 2025."
Part of the reason I have been slow commenting is that I have found many of the deals announced to the stock exchange by Scott's are really 'business as usual'. "Scott Europe" turned over $92.640m over FY2023. So while $19m of orders flowing through to FY2025 is 'nice to have', it really only represents a couple of months work for Scott Europe. So I think this announcement fits in the BAU box.
Nevertheless, the sharemarket loved it, with the share price rising from the low $2 range to over $2.40 in a couple of weeks. Perhaps it was more of a relief rally, as the share price had tanked from $3 to $2 over the preceding three months. That share price fall may have been a flow on effect of the CFO and CEO quitting in quick succession, which some may have taken as a sign of trouble that has not eventuated. With uncertainty about the reassurance of BAU can still be a good thing.
I was actually a bit disappointed in the announcement. With five palletising systems installed for Danone and one for Cranswick, we are talking a little over $3m per palletising system installation. Having watched the videos of this advanced tech in action, I thought each installation might be worth more. But the announcement does provide a useful window into quantifying these kinds of projects nevertheless.
If we use FY2018 as a normalised guide, these two contracts will lock in Scott Europe EBITDA for FY2025 of around 0.221x$19m = $4.2m (c.f. $6.186m for HY2024, and $8.514m for FY2023)
SNOOPY
One of the top jobs, the CEO position, filled today.
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"Currently based in the UK, Mike is a distinguished leader with over 20 years of experience in the automated logistics and materials handling industry. He is recognised for his innovative leadership and ability to drive significant operational excellence and profitable business growth."
"We are excited to welcome Mike as CEO. Mike brings extensive experience and a proven track record of delivering excellence across complex global organizations. He is a highly capable leader, and we are excited to have him join Scott to lead our business”, said Mr McLauchlan.
Mr Christman will join Scott from Vanderlande B.V., a global leader in the supply of logistics automation,where he has been the Global Executive Vice President of the Parcel segment since April 2021. In that role Mike has overseen a team of approximately 2000 FTEs and has been responsible for managing annual revenues exceeding €450 million. Mr Christman has played a pivotal role in defining the global market strategy and spearheading growth initiatives. His strategic focus encompasses R&D technology roadmaps, global people development plans, and long-term customer service agreements, ensuring sustained growth and market leadership."
‘I am honoured and proud to be invited by Scott to join and lead the organisation through the next chapter of growth. Building upon Scott’s already proven rich history of high performing teams, innovation, quality and deep customer focus, I look forward to developing further the strategy led by John. We will work hard to deliver even greater customer value through deepening our understanding of our customer’s needs, addressing those needs through market leading innovations and of course the highly talented Scott team’, said Mike.
Prior to his current role, Mike held various leadership positions at Vanderlande including Managing Director for the UK and Singapore where he led major transformations and achieved significant business milestones, including securing the largest order in Vanderlande Airports' history. Mike is a Chartered Engineer, holds a Master of Sciences from the University of Glasgow and is PMP Certified. He will commence his new role in October 2024 following his relocation to Auckland.
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This means we have gone from the 'enthusiastic accountant' (former CEO Hipkins) to the 'master marketing man' (outgoing CEO John Kippenberger) to incoming CEO the chartered engineer and former pimp Mike Christman. Actually that last bit is slightly wrong. I was about to praise the board for their broad-mindedness in appointing CEOs from diverse career paths. But actually 'PMP' stands for 'Project Management Professional' (not that leading role in that other profession).
Anyway, it is not a bad thing to have different career paths for successive people at the top. But it seems Mike Christman is looking to continue along the path that John Kippenberger has set (marketing proven high-tech developments rather than tackling endless R&D projects). And I would argue that is no bad thing.
Last time I bought shares in SCT, the CEO and CFO quit within a week sending the share price int a tailspin. This time, by pure luck, my timing was better as I picked up another parcel of shares yesterday, the day before the appointment of the new CEO was announced.
My $2.45 purchase price, based on historical normalised earnings of 19.3cps represents an historical PER of just 12.7. The last time the shares traded on an historic ratio that low was in 2010 (Covid loss year FY2020 excepted). Yet IMO the prospects for the company have never looked better. Go figure! (which I did, which is why I topped up on my SCT shares yesterday).
SNOOPY