Vulcan Steel to acquire Ullrich Aluminium..... impressive move IMO.
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/VSL/395761/375142.pdf
A 3.8x multiple on EBITDA looks like a good price, even in a climate of funding costs increasing. Given the jump in earnings for Ullrich in the last fiscal year over the previous FY, one wonders if Vulcan have bought at the top of the cycle? We are currently seeing a gradual reduction in DIY activity.
On a lighter note, one hopes mixing steel and aluminium does not result in galvanic corrosion.....
https://metalprofy.com/blog/how-to-prevent-galvanic-corrosion-between-aluminum-and-steel/
Vulcan ASM today
• Reaffirming FY23 EBITDA guidance of NZ$215m - NZ$235m (compared with NZ$243m recorded in FY22)
So ebitda could be 12% less than last year
Start of tougher times over next year or two
I also see that the share price at the moment isn't that far above the IPO price
At least as they proudly pointed out at the ASM those who got at IPO price got a 11.6% yield from their dividend
.... and share price done well - VSL share price: +31% vs Peer & +11% vs S&P/ASX 300 since IPO and 22% ahead of NZX50 Gross Index
Latest report out...mixed result, but slight upgrade to expected FY23 results.....STU results on Wed will be interesting
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/VSL/406616/388433.pdf
� Adjusted EBITDA was NZ$115 million (m), down 3% from NZ$118m in 1H FY22
� Adjusted NPAT NZ$54m, down 22% from NZ$70m in 1H FY22
� Reported EBITDA was NZ$115m, up 12% from NZ$102m in 1H FY22
� Reported NPAT of NZ$54m, in line with the level recorded in 1H FY22
� Revenue of NZ$638m, up 38% from NZ$463m in 1H FY22
Based on current view of market conditions and recent trading, we have narrowed our FY23 EBITDA guidance range to NZ$215m - NZ$230m from previously NZ$215m - NZ$235m (pre-IFRS 16 EBITDA of between NZ$180m and NZ$200m). We expect FY23 NPAT to be between NZ$95m and NZ$109m from previously NZ$93m and NZ$107m. With the ongoing economic and market volatility, we will update our guidance as appropriate.
Quote from: Left Field on Feb 14, 2023, 08:41 AMLatest report out...mixed result, but slight upgrade to expected FY23 results.....STU results on Wed will be interesting
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/VSL/406616/388433.pdf
� Adjusted EBITDA was NZ$115 million (m), down 3% from NZ$118m in 1H FY22
� Adjusted NPAT NZ$54m, down 22% from NZ$70m in 1H FY22
� Reported EBITDA was NZ$115m, up 12% from NZ$102m in 1H FY22
� Reported NPAT of NZ$54m, in line with the level recorded in 1H FY22
� Revenue of NZ$638m, up 38% from NZ$463m in 1H FY22
Based on current view of market conditions and recent trading, we have narrowed our FY23 EBITDA guidance range to NZ$215m - NZ$230m from previously NZ$215m - NZ$235m (pre-IFRS 16 EBITDA of between NZ$180m and NZ$200m). We expect FY23 NPAT to be between NZ$95m and NZ$109m from previously NZ$93m and NZ$107m. With the ongoing economic and market volatility, we will update our guidance as appropriate.
In line with market expectations.
No surprises except for those who are out of touch with market & company expectations?
Kingfish have added Vulcan to their portfolio
Seem pretty keen on them
Kingfish also added Vulcan Steel to the portfolio in May. Vulcan is the leading steel distributor and value-add processing player in New Zealand and Australia. It is an impressive business in an unexciting industry.
Vulcan has a differentiated business model built around a leading customer service proposition, in an industry where customer service is typically poor. Vulcan's 'delivery in full and on time' metrics are far ahead of competitors, which enables it to charge a premium for this reliability. This translates to higher profit margins and returns on capital invested. While it sounds simple, this high service model is driven by Vulcan's performance culture and customer-centric mentality.
It is enabled by its self-built technology platform and own in-house fleet of delivery vehicles, but moreover by its people and approach to customer service. The current management team have grown the business organically and have a business owner mentality with plenty of 'skin in the game'. This mentality is pushed down throughout the organisation through its flat organisational structure and de-centralised management approach, with its team members on the floor also participating in the business's success through profit share Incentives
From its beginnings in the 1990s, Vulcan has grown to command the leading position in the New Zealand steel distribution market. Its growth journey in Australia is at an early stage and there is ample runway to take market share in the fragmented Australian market from a very low base using its proven strategy. And it is succeeding; it is already larger in Australia than New Zealand. It has also more recently moved into aluminium by acquiring Ullrich Aluminium, the leading trans-Tasman player in this space, at a reasonable valuation. This increases the company's growth opportunities moving forwards in a variety of ways.
We have been following Vulcan since its IPO in late 2021. The company has been building an emerging track record of performance as a listed company. The recent share price weakness has provided the opportunity to initiate a position For Kingfish
A downgrade....Ullrich new business integration costs up $5 mill.
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/VSL/414750/398545.pdf
Quote from: Left Field on Jul 17, 2023, 09:09 AMA downgrade....Ullrich new business integration costs up $5 mill.
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/VSL/414750/398545.pdf
Even without integration costs this is still a downgrade
And last year normalised npat was $142m ....this year about $95m
Not a good year in construction industry
Quote from: winner (n) on Jul 17, 2023, 09:26 AMEven without integration costs this is still a downgrade
And last year normalised npat was $142m ....this year about $95m
Not a good year in construction industry
Down only a cent at the open - wait till Oz opens at midday for the big fall? Anyone in NZ that doesn't like this announcement has a window of a couple of hours......
Posted over at STU, but valid here too:
Steel supercycle officially over: How distributors are responding | nzherald.co.nz
https://www.youtube.com/watch?v=t2RYnf58Quo
Vulcan steel divi down in a tough year
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/VSL/417241/401634.pdf
This doesn't seem too good ...from ASM
EBITDA year to date is lower by 29% due to lower volume, reduced revenue per tonne and increased operational expenses
Jeez 29% is pretty bad
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/VSL/421234/406655.pdf
"Early signs" of stabilising in the first four months of trading in 2024 financial year.
The lead activity indicators for New Zealand suggest some recovery in 2H FY24, although this could remain tepid
but the outlook for Australia appeared to be "weakening".
Attractive yield (9.2%) at current prices, if you believe they can retain that rate, given that they cut last years by 15%. I'm happy to keep watching this one for now.
Probably a little worse than expected.
NPAT down 52% on pcp
Last three 6 monthly NPAT has been 54m then 33m and last half 26m
But well positioned for growth
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/VSL/426062/412410.pdf
A lot of 'down' words in FY24 results...... divvy reduced (down.)
https://api.nzx.com/public/announcement/436873/attachment/425669/436873-425669.pdf
� Reported NPAT of NZ$40m*, down 55% from NZ$88m in FY23
� Reported EBITDA of NZ$148m, down 29% from NZ$208m in FY23
� Adjusted NPAT of NZ$40m*, down 58% from NZ$95m in 1H FY23
� Adjusted EBITDA of NZ$148m, down 33% from NZ$219m in FY23
� Operating cashflow of NZ$169m, up 16% from $145m in FY23
� 12.0 NZ cents per share final dividend declared for FY24
Outlook ....trading activity in H125 in Australia and New Zealand expected to remain ar low levels similar to H224
In H224 NPAT was $14m (10 cents per share) ......so full year not looking too good
And that $14m was DOWN from $40m pcp
No surprise for me but to some this is of a shocker update from Vulcan
Q125 - Volumes down 10% and revenues down 13% and ebitda down 40% v pcp
They remain optimistic but I'm sticking to my 2027/2028 forecast as to timing of any decent recovery
https://api.nzx.com/public/announcement/440387/attachment/429994/440387-429994.pdf
And talking about bank covenants and supportive bankers never a good sign
EBITDA only $23m in Q1
At this rate H1 NPAT won't be very much ...not a Loss but not very much profit
Volumes down 10% and revenues down 13% suggests lower selling prices and reduced margins.
Be interesting how H125 turns out
Market must have been thinking the worst and todays news is good news ..a relief maybe
Share price upn5% and back over 9 bucks ...not far off its highs of last couple years
Quote from: winner (n) on Oct 21, 2024, 03:39 PMMarket must have been thinking the worst and todays news is good news ..a relief maybe
Share price upn5% and back over 9 bucks ...not far off its highs of last couple years
Markets are forwards looking - and maybe not everybody has such a bleak picture of the future :) ;
Quote from: BlackPeter on Oct 21, 2024, 04:33 PMMarkets are forwards looking - and maybe not everybody has such a bleak picture of the future :) ;
What was the forward looking market looking at when share was close to 11 bucks not that long ago?
Mr Market has amnesia and schizophrenia.
Quote from: winner (n) on Oct 21, 2024, 05:09 PMWhat was the forward looking market looking at when share was close to 11 bucks not that long ago?
Markets always forward looking - however, this does not mean they can see the future better than anybody else :P ; As we all know - while every Tom, Dick and Harry is able to predict the future (and they do), NOBODY is able to do that with any statistical relevance. Its just noise.
Quote from: BlackPeter on Oct 22, 2024, 10:05 AMMarkets always forward looking - however, this does not mean they can see the future better than anybody else :P ; As we all know - while every Tom, Dick and Harry is able to predict the future (and they do), NOBODY is able to do that with any statistical relevance. Its just noise.
So it's OK for the market to think VSL going to be busy at the same time as me having a "bleak picture of the future"
Quote from: winner (n) on Oct 22, 2024, 12:03 PMSo it's OK for the market to think VSL going to be busy at the same time as me having a "bleak picture of the future"
Absolutely. While I am not sure, whether its good for ones mental health to have a bleak picture of the future, there is no rule prohibiting it.
However ... given that pessimists are not more often right than optimists, and given that optimists feel much better than pessimists, it clearly is beneficial to have a less bleak view of the future.
Quote from: BlackPeter on Oct 22, 2024, 04:14 PMAbsolutely. While I am not sure, whether its good for ones mental health to have a bleak picture of the future, there is no rule prohibiting it.
However ... given that pessimists are not more often right than optimists, and given that optimists feel much better than pessimists, it clearly is beneficial to have a less bleak view of the future.
You used the words 'dismal' and 'bleak' ...... but I'm an optimist and in good mental health
Suppose my forecast around Vulcans future level of activity is 'dismal' but it's only 'dismal' because it's at odds withbVulcan's (and I suspect yours) view of things.
I've been involved in related industries most of my life. I stand by my considered view that the rhetoric of all this work coming up won't provide boom times for the likes of Vulcan. ....things will plod along as they are for a few more years but we might see things getting better in 2027/2028
The optimists probably believe in "The Growth Fairy" ...bugger can't post an image because a simple screen capture file is too big ....ironically had to go into shrink mode to show image
IMG_5952.jpeg
Quote from: winner (n) on Oct 23, 2024, 08:13 AMYou used the words 'dismal' and 'bleak' ...... but I'm an optimist and in good mental health
Suppose my forecast around Vulcans future level of activity is 'dismal' but it's only 'dismal' because it's at odds withbVulcan's (and I suspect yours) view of things.
I've been involved in related industries most of my life. I stand by my considered view that the rhetoric of all this work coming up won't provide boom times for the likes of Vulcan. ....things will plod along as they are for a few more years but we might see things getting better in 2027/2028
The optimists probably believe in "The Growth Fairy" ...bugger can't post an image because a simple screen capture file is too big ....ironically had to go into shrink mode to show image
IMG_5952.jpeg
All good, winner.
First - I have no view at all on the future of VSL. From a personal perspective - I am not invested in them because I don't like their balance sheet.
But yes, I am somewhat more optimistic regarding the nearer future of the industry ... but hey - maybe its my believe in the growth fairy, or maybe its your believe in whoever the opposite to the growth fairy is.
Both of us could be right ... and most of that will be dependant on future events both of us don't know about yet. No need to quarrel.
BTW - I didn't use the word "dismal". Where did you find that?
Quote from: BlackPeter on Oct 23, 2024, 09:21 AMAll good, winner.
First - I have no view at all on the future of VSL. From a personal perspective - I am not invested in them because I don't like their balance sheet.
But yes, I am somewhat more optimistic regarding the nearer future of the industry ... but hey - maybe its my believe in the growth fairy, or maybe its your believe in whoever the opposite to the growth fairy is.
Both of us could be right ... and most of that will be dependant on future events both of us don't know about yet. No need to quarrel.
BTW - I didn't use the word "dismal". Where did you find that?
Maybe the 'average' if views for VSL and STU is that volumes/sales will flatline for the next few years
Did you see Fletchers say last 3 months volumes 10%-15% lower than pcp and expect that to contine for the next 9 months
The forward looking market seems to have an abrupt about turn last few days
Now seeing not so good times for Vulcan as share price drops more than 10%
Quote from: winner (n) on Oct 25, 2024, 05:31 PMThe forward looking market seems to have an abrupt about turn last few days
Now seeing not so good times for Vulcan as share price drops more than 10%
I think you take the jitter too serious. VSL is moving for over a year in a channel between $7 and $9, and this is where they stayed - actually quite in the middle.
https://nz.finance.yahoo.com/quote/VSL.NZ/
Maybe somebody read my last post and noticed as well that the balance sheet doesn't look too flash?