This stock has jumped in the last 2 days, after doing nothing for a while yet I can' find anything to suggest why?
Anybody know?
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This stock has jumped in the last 2 days, after doing nothing for a while yet I can' find anything to suggest why?
Anybody know?
investors have been a bit scared of a slow down in the construction sector, fbu today has showed that things are going along gang-busters at the moment and with comercial taking over from residential it doesn't look like it will slow down any time soon.
Don't forget that once commericial slows down there will still be a large amount of public works construction, and that, if anything will use even more steel....
Up 20c so far today to 520. STU doubtless coat-tailing FBU to some degree.
After a break of five years I bought back into STU in September @ 452. Now showing a 29.2% gain + 15c final div.
That's an 18% return including the div.
where do you get 29.2% from?
3-4 years ago when STU was sitting on $1.30 and had a tiny p/e, I looked at it for a long time and then decided against it. Probably been one of the most untalked about stocks in that time but has shown legs.
Sorry.
BRICKS visited STU today and is most impressed with the outcome well maintained buildings
not like the old days they are taking a bit of a beating just at present but the two things going for them One Steel wants to BUY & they pay DIVIDENDS..
Yes, I agree with that.
STU is one of my income stocks and a classic cyclical IMO.
Ideally, I should be lightening off at the peak of the cycle ( SP and economic activity) and loading up at times like these. I never do, of course, but it's still a good earner even when times are tight.
Might still buy a few more but there are so many other girls to kiss and I'm still only grudgingly parting with my cash.
;)
There is not much that can be added to your comments, YK. You have covered the important facts such as the low volume - today's big rise to $3 was on just 1911 shares, for example.
I have not plotted my usual raft of supplementary indicators on this chart because STU is in a consolidation zone and in such circumstances trend indicators just give a series of contradictory signals. The 100 ma cross you mention has no significance - price action has risen above it 6 times so far during the course of this wide trading range.
For STU to break its longterm (4 year) downtrend, the shareprice would need to go above the Resistance at $3.80. That is well above current price action and would mean a fairly late entry. The break of the current confirmed short-term trendline would make for a more timely signal for those wanting to buy.
I would see a retreat to the support at $2.50 as a buying opportunity.
The break of the 5 year uptrend gave a timely trendline-break Sell signal, getting you out of STU before you gave a lot of profits back to the market. A nice example of why a staunch "buy and hold" approach is a bad idea!
http://h1.ripway.com/78963/STU51.gif
IMO it's just a matter of time before STU's major shareholder takes them out.
Now would be a good time to do that but doubtful whether Onesteel ( or is it Bluescope?) has the cash to do so.
Meanwhile, it's a nice little divvy payer with potential for a bit of capital gain eventually.
And me at $2.53. Haven't looked at it today. Too busy buying and selling other stuff!
Yes, it really is remarkable how that level has held strong over the years - especially through the current turmoil. I don't think there are any really safe havens, but if there were, STU would have to be on the list.
There is no great insight to be gained from the chart apart from viewing the support. It's good that the OBV seems to have stopped falling, but the recent trendline break "buy" signal was caused by the OBV crabbing sideways rather than by a definitive rise so it should be ignored.
If I were in your situation, I would be inclined to hold on to my $2.57 - $2.58 STU and delay buying more until the global situation settles a little. This is a very good time to be holding cash. Here's a thought for you - maybe when you do buy, you would do better investing in something that had been severely beaten down, rather than adding to your STU investment - a stock you already hold at a good price and one that has not been hammered.
http://i602.photobucket.com/albums/t...B/STU521-1.gif
Now $2.15. FY result out today and puts it on P/E of about 19. Not that they're in bad shape, just a great example of a cyclical. Heavily dependent on capex, especially in commercial building and rural (dairy sheds). Hard to see much pick up for a while. In another year or so, maybe everyone will have forgotten about how much money they make in a boom and it will be time to buy. After all, they are "well-positioned for the future", eh Percy? ;)
looks like a trendbreak on price today percy,
no volume support and other indicators yet to fire also.
V.
Trends are more spectacular than the TA indicators...unfortunately :(
On closer observation the spectacular nature of this chart is dulled by the price column.. the big rises aren't that big as it looks.
However... the chart shows some great gap events and yesterdays gapped bound ascending triangle breakout ..spooky huh?
http://i458.photobucket.com/albums/q...TU04022011.png
This chart shows any STU "Buy" signals, Bullish Divergences and positive indicators.
STU appears to be on the verge of a trendline break.
Note that this is an unconfirmed trendline.
Vtrader notes that there is no volume support and other indicators are yet to fire.
That's the good news.
The bad news is that STU is still in a 6 year downtrend.
http://i602.photobucket.com/albums/t...usPB/STU28.gif
Hoop, thank you.
Phaedrus,thank you.I saw the long term down trend,but thought it may have turned. I suppose I was looking to buy.Was not sure,.so very much appriciate your guidance.
A solid result from STU with half year underlying profit of around $8m, giving full year NPAT of $17m, an increase of 168% on the previous year.
SP up 2c.
I agree, percy. The result was a touch above where I was expecting, but was a bit disappointed the outlook wasn't stronger. Then again, STU can be a bit like that and tend to be a bit more bumpy than others, so may surprise (either way!) at half year. Nice to see the big chunky div though - that won't go amiss.
Yes, Lizard, STU management seldom seem to see the glass more than half full, even at the best of times. Can hardly blame them given the unpredictable nature of their sector and business conditions generally. I thought it was a pretty good result and a realistic assessment of prospects.
Jeez the CEOs speech at the AGM was a bit sombre - I've heard more cheerful stuff at funerals
So half year $6-$7m almost 50% down on last year .... no matter the shareprice is starting to dive - so the charts only looked better for a little while
STU doing their best ..... like all associated with the construction/building industry hard to do bloody well when business is down 20% .... but the boom times have gone for a decade or more and outfits like STU need to understand that today level of activity is the new norm ... well maybe a bit better but not that much. I sense they recognise this and that is good
Just as well they have a controlling shareholder eh
[QUOTE=winner69;360731]Jeez the CEOs speech at the AGM was a bit sombre - I've heard more cheerful stuff at funerals
Guess there was no talk of increasing the director's fees.!!!!!!
The DomPost (James Weir) takes a different tone. Photo of CEO Dave Taylor is headed "Upbeat message".Quote:
Jeez the CEOs speech at the AGM was a bit sombre - I've heard more cheerful stuff at funerals
Different takes on the same information makes the market!
I try to attend as many meetings as I can,because I have found reports of meetings totally at odds with my view queit often.
I put this down to reporters not actually owning shares in companies they report on.They just do not have the owner's eye.
I value sharetraders reports on meetings they have attended for the same reason;"the owner's eye."
I was there at the AGM (representing a shareholder I was even though really an interested industry observer) and listened to the speeches and left before the sandwiches which probablyy would have been quite nice
Might have been upbeat about last year but was pretty sombre about the present and the next yearl Haven't seen the DomPost today for that photo of an upbeat Taylor but Weirs report doesn't read 'upbeat'
They'll be OK as long as shareholders (ie the market) doesn't expect miracles ... we all need to accept the new norm that (real) growth is a thing of the past
Have just run my dividend metric over STU.
2012F: 5.5c, 5.5c
2011: 9.0c, 6.0c
2010: 3.5c, 5.5c
2009: 9.0c, 10.0c
2008: 10.0c, 9.0c
-----
Average dps over the last 5 years is 12.5c
12.5/0.08= a share price of $1.56!
I am really shocked by this. STU is a very well run company and if they can't make money from construction then no-one can IMO. My formula says sell STU as it is currently significantly overvalued. My head tells me don't invest in any share that make their money from building stuff!
SNOOPY
I have to unfortunately agree with you.Appears an extremely well run company ,can't go against the trend,yet a poorly run company in the right sector at the right time can make a good profit.I am thinking of Dominan Finance who's five year record looked great until a down turn and we saw all the figures were false.Nice to see well run SCY report a great profit today.Only wish I still held some,as I sold out of all retail stocks,except one disaster in Aussie.!
Looks like I underwent a momentary mutt metamorphosis from 'Snoopy' to 'Goofy' here. My calculation was the correct calculation for net income, but I need to work with 'gross income' to be consistent with my other examples.
(12.5/0.7)/0.08= $2.23
So with the current market value of $2.07, there is still value there for long term buyers after all.
SNOOPY
Well I guess holders aren't going to be too chuffed (nor, perhaps, surprised) at a 3.5cps chop to the final dividend. Takes total div down to 11cps. However, still 1cps higher than Snoopy was forecasting.
Eventually the market will stabilise - surely the earthquake-strengthening projects in a few buildings will require steel? Not in bad shape at balance-sheet level, but maybe still too early to buy construction cyclicals. Could be one to consider at next half year... OIC result might give a glimpse of the extent to which any construction pipeline is developing.
Should add that it was very disappointing that they are still stuck on "well-positioned". I'm sure they're at least two reporting seasons behind the play with that one... I suggest that for the AGM they skip straight past "solid result" to a "positive trajectory"!!! :p
Oh dear - I rushed that one.... okay, the correct figures should be a 2.5cps chop to the final dividend (from 9.0cps to 6.5cps), bringing the total div to 12.0cps - (from 15.0cps prior). Still 1cps higher than Snoopy's forecast 2012 year end dividend of 5.5cps (but 0.5cps lower than his total 12.5cps average over 5 years). Using Snoopy's "5 year average dividend at required 8% yield" formula, the valuation would be $1.65.
Although I would dispute that:
a) the last 5 years represents an entire business cycle for STU (I think it's only the low half of the cycle - e.g. total divs were 29cps in 2007, 32cps in 2006) and
b) the use of 8% yield is a measure of fair value (the average dividend yield on NZ shares over 3 or 4 decades is only about 4% as I understand it - even though typical interest rates were much higher during most of that period than they are now.)
Until building permits improve and ChCh rebuild gathers momentum STU faces too strong a head winds.
Good company to have on your watch list,as their time in the sun will be very rewarding for shareholders.
Is their controlling shareholder there for the long term.?
Lizard.Quote for you from the book I have just started reading,Damage by John Lescroart,page 22.
""the TRAJECTORY there isn't up."
I can't even relaxe in a book.!!!!!!!!!!!
So would I! You used my 'Goofy' calculation based on net yield rather than my 'Snoopy' calculation based on gross yield.
$1.65/0.7 = $2.36 (the Snoopy valuation)
Yes I agree, probably looking at a ten year picture would give a better 'business cycle' result. With the nervous qualification that this takes in data before the 2008 GFC which may be doubtful data to use going forwards. I am of the opinion that the economy won't return to its pre GFC state for at least a decade, and maybe never.Quote:
a) the last 5 years represents an entire business cycle for STU (I think it's only the low half of the cycle - e.g. total divs were 29cps in 2007, 32cps in 2006) and
Fair point although my 8% yield was not meant to be representative of all shares. Just representative of high yielding low growth shares in a mature market. I believe STU fits into that category.Quote:
b) the use of 8% yield is a measure of fair value (the average dividend yield on NZ shares over 3 or 4 decades is only about 4% as I understand it - even though typical interest rates were much higher during most of that period than they are now.)
The other reason to use 8% is that the result may carry some margin of safety which as investors we can always do with!
SNOOPY
Onesteel tried to take STU out a few years ago. Sine then they have had the GFC, the curse of the Oz government's mineral tax and the high Oz dollar to contend with.
Onesteel changed their name to Arrium this month to, and the share price is just a fraction of it was during the mineral market peak. I don't see a controlling shareholder buyout of Arrium is on the cards in the foreseeable future.
SNOOPY
Hi SnoopyQuote:
I don't see a controlling shareholder buyout of Arrium is on the cards in the foreseeable future.
I assume you meant "by Arrium" and I'd agree with that. Arrium have plenty on their plate without taking on more of STU - and after all the name change was designed to alter perceptions that OST was a purely steel manufacturer. In the period from 2007 -2012, the company's"steel" assets dropped from 92% to 47% of total value, the balance being largely Mining anf Mining Consumables. I don't see them wanting to reverse that trend.
I brought back in today at $2.877.
It appears the Fortress Fasteners acquisition is better than I thought.
You will likely get some volatility in this cyclic industry which will be different to slow and steady of POT.
Its been a while since I looked into STU. It is normally very cut throat industry with tight margins and dependent on large construction projects as well as a good eye on inventory levels / cashflow.
Given recent dairy construction boom which required heaps of stainless steel and that we are half way through Christchurch rebuild, do you think there will be enough non residential construction to provide growth and profitability beyond the next few years?
Projections.............. 2015............. 2016......................2017
Craigs eps................0.25.................0.29...... .................0.35
4-Traders eps...........0.25................0.289........... ...........0.329
Craigs PE..................11.5..................9.7..... .................8.1
4-Traders PE..............11.4.................9.9.......... ............8.7
Craigs dps..................0.20...............0.23...... ...............0.28
4-Traers.dps...............0.195..............0.217. ................0.24
Craigs div yield............6.8%...............8%............ ..........9.6%
Craigs eps growth.......23.2%.............17.8%.............. ..20%.
The eps growth took me by surprise,as did the yield..
Yes W69,it must have been a fantastic acquisition.
Nasi Goreng.Agree with you,that is why I sold some time ago,but looking at the above projections you can see why I brought back in..
Great result from STU this year
Black mark for using 'well positioned' in the announcement
Only needs the market to get rid of its current negative sentiment to building related stocks to get share price to $3 plus.
I like the announcement too....but haven't had a full read. Overall, I have held this share since March 2010 as it has always seemed solid with a good yield. Let us see what the numbers actually say and how the low dollar impacts the overall picture.
There's not a lot to read. Only the one page as far as I can see and all good news!
:)
If I am not wrong (back of envelope), their price to sales ratio is still low....if price is 2.82, share on issue are 90 million and sales are 500 million that puts the ratio of around 0.5? This is a key ratio for me as it shows, for this type of company, what is actually passing through the system! For sTU where I am not sure of the growth and it is cyclical this will keep me in the investment....
Yes a good year,but was not as good as I hoped for,so I sold.
While the rest of the family has been watching the rugby, I have been reviewing STU in my normal manner. I will buy more as all is looking solid. However, I shall take a gamble on the price easing a little more. Agree that there is nothing startling about the report, just solid low margin industrial.
2015 AT-EPS came in at 24.5c, net dividend 19c, fully imputed.
1) Aquaduct acquisition announced today.
- Relocatable factory making large bore very long pipes (fewer seams). Looks good.
- Bought off the receivers for asset value $8m; forecast EBIT 0.5-1.5m with NO project income. Staff and branding / goodwill retained.
- Prospect of up to $20m project income income from major irrigation projects (giving, by my estimate, $4m NPAT).
- Net effect on eps 0-5cps (my estimate).
2) Fortress acquisition adds 4.5 cps
3) Inherent growth estimated at 11% (20% in 2015)
4) debt/debt+ equity 30% in 2015, rising to 32% with aquaduct buy, and back to 30% in 2016.
The 2015 dividend payout ratio of 78% seems sustainable.
Jun-15 post-aquaduct 06/16 e Bank debt 72 80 73 equity 167 167 174 d/(d+e) 30% 32% 30%
Looking at 2016:
15 16 npat ul 21.4 30.8 net eps ul 0.245 0.340 net payout % 78% 78% gross dps 0.264 0.366 gross yield % 10.1% 14.0%
eps for 2016 = 24.5c+11% growth + 4.5c (Fortress) + 2c (Aquaduct)
Looks like a high yielding stock with strong recent EPS growth, two good recent acquisitions and a good story - irrigation income.
It's in a slow downtrend.
Sure will bean earnings surprise in 2016 by the looks of it ....and maybe 2017 as well
Market don't like announcement
https://www.nzx.com/files/attachments/224651.pdf
This result shows it is very difficult swimming against the tide.
Tough times for S&T, I really like their report though - very clear and straight up on their situation.
S/p hitting $2.31 up re 10% since announcement on good vol, shooting through 60DMA. Interim Div 9c (last 6 month 10c) re 8.23% nett yield (according to ASB)
Misleading representations re products not a good look even if though they say just an oversight. **** does happen sometime.
Ironic seeing STU moan about shonky imports and how unfair the world is to them.
Whatever a reflection of company culture - obviously not good
Yes , listened to CEO being interviewed this morn on National Radio . Had an excuse that wasn't, refused to answer critical questions, very unprofessional, came across shocking.
The interview
http://www.radionz.co.nz/audio/player/201793532
Only thing he really admitted was there were thousands of these 'certificates'
Trust isverything. Wonder what oer things ae 'mistakenly' been done latelyi
So the production manager is also in charge of the testing lab issuing certicates (Radio NZ this morning). Lab not accredited either.
STU seem loathe to get independent checks done. Be a disaster if found if this mesh didn't comply wouldn't it
Looks like making money for shareholders (and management bonuses?) higher priority than good practices and company reputation and that's not considering any implications about the integrity of the buildings this steel gone into.
They forgot to update a form..... dont spill your coffee.
Unfortunately, it looks a little more serious than that.The testing was apparently carried out in the comopany's own lab; the lab's not properly accredited; and the manager who signed off on the cerificate is also a factory manager. Meanwhile, being very careful with my coffee.
Apparently in-house testing is entirely normal and accepted practice in the industry. Nothing illegal in that.
I suspect this storm in a tea-cup got whipped up by those competitors who DID actually get pulled up for
selling suspected sub-strength imported mesh by ComCom and had to withdraw their product from market.
Funny you don't hear about the worried owners of the houses where that stuff was used, instead everybody
is talking about one stamp too much on the form of STU.
Agreed Sideline. In house testing is not an issue in itself. What is interesting is that the company, unless I have missed it, has not come out and defended its testing system to give everyone confidence that it is at least comparable to that performed by Holmes. I am quite surprised that they have not done this and that makes me wonder if there is more than just using the wrong logo on the testing certificate behind the issue. I am not sure if they have an accredited quality system, ISO9001 ?, couldn't see any reference to one on their website. So it may be that the testing done has not been rigorous or well done ? I guess they will be expecting a pretty significan audit...and that may be the reason for the silence, especially if there are any testing anomalies.
RTM,
can't find any ISO stuff either.
In their Corporate Profile STU talk a bit about their quality standards and in particular about the reinforcing mesh (page 15).
In particular they say: "Before it
leaves the factory floor, each sheet
of reinforcing is tested and tagged
with a unique identifier linking the
sheet to its test certification, date
of manufacture and quality control
data. The tag remains with the
sheet throughout the life of the
product and can be used to track
performance years after the sheet
is installed"
I can't see the issue. It is standard industry practice and legal for them to do their own testing. The only issue was that the testing laboratoy they used to use was still on the certification form. This was discovered during an internal audit.
Agree, i still think it's a beat-up.
I actually listened to the story on National Radio when it 'broke' and could hardly believe how often the interviewer
managed to mention 'Steel and Tube' in the article - there was no mentioning of the other two (importing) companies
whose products actually had been found to be wanting and were under investigation by ComCom. The uproar was all about the
inappropriate stamp on the paper. Made me wonder about the quality of that journalism and whether other interests
are at play in that story and the way it is reported.
Today I see that somebody labelled 'top-lab' opines that inhouse testing can not be trusted - maybe somebody
trying to drum up some more business for themselves??
If the in house testing is above board then things will smooth out; if its not certified but robust enough it will work out; maybe a big fine, maybe have to pay a certified tester; an expense; if its not certified and not up to standard it will be one huge mess maybe like leaky homes or worse.The CEO did sound less then transparent.
I agree that the CEO seemed to treat the issue just as a documentation issue (which they discovered and reported themselves)
and management were obviously a bit surprised by the spin the merchants of doubt at RadioNZ put on the story.
There was no such hysteria when two weeks ago the other two companies were forced by ComCom to stop selling their sheets because
they were actually found to be somewhat below the new standards required since the Christchurch earthquakes. 400000 of those sheets have been
already used in construction but nobody talked about a 'huge mess'. The talk at that time was that because the new standards were so much
higher than the previous ones the users of those sheets wouldn't need to worry.
One reason I listen to National Radio precisely because of their accuracy, honesty and intent to get to the truth about things. There is no bull dust spin here (except maybe in the wine and food programmes:) . If you want spin go to Mike hosking and co.
This subject about reinforcing has triggered re my int in EDE Eden on the ASX. they have a concrete additive which strengthens and causes less abrasion and shrinkage to concrete; maybe even eliminating the need for so much reinforcing in some situs. Their edge is that they know how to spread the carbon nanotubes evenly through the mix (patented i think)I hold a parcel of shares
I listen to National Radio - or RNZ as they persist in calling it these days ( I keep expecting to hear an "AF" or an "N" to complete it! ) but can't help feeling that they have either latched on to what they regard as a scoop - no one else seems to treat the matter with the same persistence - or maybe that they have been fed some lines by a vested interest. I hope so anyway, as I'm still holding a modest pot of STU.
:mellow:
Still holding some in our family trust. They've been persisting along time.Kim Hill used to create some sparks when she was on every weekday 6-9 with her drilling in style, polarising,Geoff Robinson a lovely guy but didn't haven't enough authority to get to the bottom of things. Current presenters really try and i love that persistence.But one can only do so much when the interviewee plays"no comment" or talks politic speak' or all around it
CEO was distinctly unimpressive on the TV3 news item I saw. I doubt Sir John Anderson (Chairman) would allow any deceitful behaviour by SKL executives over certification, though I do recall that STU failed to face up to a debt to Levines (?) over a building rental and got dragged through the courts over it a year or so ago with Sir John at the helm.
The beat up continues - doesn't meet standards
http://www.radionz.co.nz/audio/player/201794316
http://www.radionz.co.nz/audio/player/201794316
Corporate reputation/risk balanced about maximising profits for shareholders is tricky stuff ....bugger forgot maximising management bonuses
A certain degree of backtracking by NZR this morning - shortly before 7.30am - from the claims made last week against STU. I didn't catch it all but didn't actually hear the word "apology"! Was anyone paying closer attention?
Thanks macduffy for pointing it out. I would have missed it otherwise - that's how quietly they try to slip through
their 'correction'.
The word apology wasn't mentioned.
And the way they 'corrected' their story bears no relation to the hype (and frequency) when they pushed
their original 'scoop' story. Altogether very unprofessional and lacking integrity by RadioNZ.
You can listen to the 'correction' here: http://podcast.radionz.co.nz/mnr/mnr...roblem-048.mp3
Looks like RNZ bought and tested threaded rods. A thread can act as a stress concentration and produce a test result materially lower than might be expected of the same structure with straight rods, made from otherwise the same metal and chemical composition. Then RNZ admits that the test results related to different rods, not the rods that RNZ actually purchased! That seems a total disconnect!
However, as part of the news release by STU to the NZX at 9am today:
--------
(Steel & Tube CEO) Mr Taylor says despite the laboratories testing against the same standard, Steel & Tube has been surprised by the variability in the results, including results provided by the Commerce Commission, and has encountered significant ambiguity around the interpretation of the testing standards.
Mr Taylor supports statements made by the Ministry of Business, Innovation and Employment (MBIE), that this is a question of standards.
“Given the ambiguity and interpretation encountered by Steel & Tube, perhaps it’s time to review the standards regime through the establishment of an Industry/Government working group”
-------
So it looks like, despite the dodgy testing methodology used by RNZ in the first place, they might be onto something after all?
SNOOPY
https://www.nzx.com/companies/STU/announcements/282534
Just when the SP was looking up.
So They say ........FY16 full year underlying profit is expected to fall short of last year’s NPAT by between 10 and 15%.
That's pretty bad when you consider that this year also includes the profit from those recent acquisitions which didn't have a full year last year.
I doubt things will ever be easy for STU .....and the past few years have seen a pretty big upswing in building activity (some say a boom evenallow for Christchurch)
So on a like for like basis FY profits going to be down 20%-25% on LY
Thats accounting for the contribution from new business this year
A tough week for STU, with Macquarie coming out with 35% fall in target price following this weeks earnings warnings (down to $1.80). Another factor to weigh up here is that there is a good chance that STU may drop out of the NZX50 when the quarterly update comes out in early June (best to check with your share broker on this though), which would see index based selling. Be careful on this one
More on the Steel Mesh issue
From Radio New Zealand 8.35am
Steel mesh falls short in crucial tests
New figures show the extent that steel reinforcing mesh for house floors has been falling short in crucial tests, with mesh from three out of five companies failing to meet the mark.
The scores of failed tests released by the Commerce Commission under the Official Information Act - and the fact that three top laboratories rated the same pieces of steel differently - have prompted an overhaul of testing, four years after the seismic mesh first came on the market following the Christchurch quakes.
The Ministry of Business, Innovation and Employment (MBIE) has not explained why it did not try to find out sooner if the products and testing were up to scratch, in its role as regulator.
The Commerce Commission has pointed out that the failed tests alone did not prove a company had failed to comply with the standard in the Building Code.
It also said some of the companies were challenging the test results amid fears they would be prosecuted under the Fair Trading Act.
"Some steel mesh suppliers have raised concerns that release of the testing results could prejudice their right to a fair trial," said the Commission, though it added that this was unlikely.
The 70 pages of tests showed the sheets of mesh from three out of five companies failed in almost all cases to reach the required standard of 10 percent ductility, or stretchability.
Among the lows, sheets from Euro Corp scored just 1.7, 3 and 4.5 percent, while Steel and Tube had a run of three sheets with an average score of under 6.5 percent.
Mesh from Brilliance Steel recorded slightly higher test results, but still not above the 10 percent.
These tests resulted in these three companies having to withdraw their seismic mesh from the market for several weeks.
Mesh from Fletcher Building and United Steel passed the tests.
But other types of tests also failed, including for Fletcher, where the welds broke where they should not have on two of its three sheets. Welds also broke too soon on Steel & Tube and Euro Corp mesh.
The tests also showed up discrepancies between the testing laboratories - in this case SAI and SGS as well as Holmes Solutions, which did fewer of the tests.
In one instance, SAI scored a sheet at 8.6 percent ductility in one spot and SGS at 3.5 percent. Another test saw a difference of 7.5 percent versus 1.7 percent.
Across the dozens of results, discrepancies of 2-3 percentage points were common, throwing the averages out.
MBIE was now moving to fix these variations, which have thrown a spanner of uncertainty into four years of mesh production.
It has just issued draft guidelines setting out exactly what part of the mesh to test and how, which was not clear before, although it has refused to provide the draft to RNZ News.
While MBIE was using the term 'guidelines', they would be mandatory for any meshmaker wanting to meet the standard.
It points to MBIE switching from a hands-off approach to regulation that has predominated for years. It remains unclear whether it would push on with compulsory third-party testing, where other building products were judged to be critical.
As for steel mesh, only the smallest of the four grades - which range from 6mm up to 9mm - have been tested by the Commerce Commission.
RNZ News has been told by industry insiders that it was even harder to make the bigger sizes hit the ductility standard.
STU share price as weak as its steel mesh?
Sub $2 tomorrow?
Hmmm not a good performance today given the strength of the market, I'm picking at the upcoming NZX 50 review, Steel & Tube out and Scales in.
I get the feeling many don't believe this
This steel 'issue' seems to be getting worse
GENERAL: STU: Recent Media - Huntly Bypass
Given the recent media attention around the Huntly Bypass pile casings, Steel
& Tube confirms its 18 May FY2016 earnings guidance disclosure appropriately
incorporated any impact from this issue.
On the radio today there was mention of a Chinese supplier looking to compete against STU to jump in the gap made by the recent certification issue. Apparently their product is certified and the open trade agreement doesn't prevent them from competing.
I wonder how easy it would be to compete in NZ given the cost of shipping metal (must be heavy, therefore expensive)? Does STU get its metal from abroad or locally, does anyone know?
Thanks, so probably a Chinese competitor could be threatening?
I'm not a holder of this one, buy I could come to the party of there's a drop in price with no real threat of a difficult competitor.
Structural steel and most commonly steel plate is imported from overseas. There are still quality concerns about Chinese steel and it is paramount that mill certificates are thoroughly examined before using the product. That said, there have been instances of fake mill certificates and accreditation. I would say most steel fabricators would import steel when possible as it is cheaper. This is most commonly steel plate because structural steel (beams, columns etc) needs to be made to New Zealand/Australia standard sizes. I image this is less appealing for overseas steel producers due to our smaller market.
Reinforcing steel is usually less of an issue because I believe most is sourced locally (of which steel and tube is a major player).
Punters still not believing that succinct statement from STU yesterday
Not good - more to come?
Sharechat - http://www.sharechat.co.nz/article/4...n-15-yearshtml
Strange hey go back to 9/11 lows - weird
Wonder when time to have a leap of faith as the fat prophet man says
I'd suggest waiting till after the index sellers come out. STU highly likely to be out of NZX50 (announcement 9 June) thereafter quite simply the stock will be sold as the index guys sell the stock. I'm targeting late June as a safer time to buy