You are a true "gem" KW.
Thank you.
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Agree,
MNY has yet to secure any debt funding facility.
As a result, in order to fund growth, they have had to constantly undertake capital raises over the past 3 years, which is a very expensive form of funding and very dilutionary.
They had to cut their dividend last year as a result.
They really need to secure a decent funding facility to leverage their balance sheet, the same way that FSA has grown, to stop their reliance on equity funding.
I think HDX would have to be one of the cheapest, quality mining services companies going round. Absolutely blue chip customer base and dominating market share.
Trading on less than 4 times FY13 NPAT plus offering 35% + EPS growth over FY13/14.
Extract from a recent broker report:
"HDX was able to report in November that growth is being driven by displacement of competitors (the largest component of recent growth), net expansion of the requirements of
existing clients and opportunities in new pits. A stable blue-chip client base at long life
mines underpins this growth.
HDX’s recent positive earnings guidance for the current December half contrasts with
downgraded guidance from many mining service companies including Boart Longyear
(BLY), NRW Holdings (NWH), Mastermyne Group (MYE) and others. The outlooks for
these companies have been negatively impacted by lower capital expenditure expectations
from major companies, challenging market conditions for a number of junior miners and
generally lower guidance on EBITDA margins arising from a more competitive environment
for most contractors."
Cheers for that Steve, looks like a well run company, are you in?
Yes.
Theres a couple of things to note though:
1) Given it is not forecast to pay any tax until FY15, unlikely there will be any dividends before then
2) 3 of the 4 broker reports i have read say there is a possibility of a future capital raising, given the growth they have experienced (debt funded to date)
3) It is obviously exposed to the coal sector, but as per the recent HDX presentation, Australian coal production is forecast to grow through to 2017 (and i assume beyond) , which bodes well for the growth opportunities for HDX.
Hughes Drilling is easy to understand. Small area, stick to a niche market of coal mines in Australia. As long as coal is required as per their expectation they should do okay.
Picked up some HDX yest. Lots to like.
Exclusively, essential pit production drilling,all surface i think for blue chip customers with long life low cost producers.
Looking forward to results.
Looks like MNY has been listening to me:
"The Directors of Money3 Corporation Limited (Money3) are pleased to advise that Money3 has mandated Westpac Banking Corporation (Westpac) to establish a $20 million credit facility to expand its motor vehicle finance business "
Should put an end to all the equity raisings
http://stocknessmonster.com/news-ite...E=ASX&N=385792