SML - Synlait

[mcdongle]

Bumped into a neighbour yesterday who works on the recruitment side of things at Synlait.
They now employ more people than before the recent round of layoffs he said...

[Basil]

https://www.marketscreener.com/quote/stock/SYNLAIT-MILK-LIMITED-14391761/financials/
Analysts are neutral on it.  Currency seems headed upwards.
Its hard to forget the truly shocking lack of disclosure around Pokeno in the past.
Its also notable that Synlait has never paid a dividend.
Their absolute obsession with all things ESG is tiresome to say the least.
Their balance sheet is not in the best shape.
Good the new CEO has some aspirational goals and is bringing a fresh approach.
Good luck with it.

[winner (n)]

Golly gosh ....share price up 7% today to 340

Break through 350 and it will be on way to 5 bucks

Lots to like about Synlait's future

[BlackPeter]

Golly gosh ....share price up 7% today to 340

Break through 350 and it will be on way to 5 bucks

Lots to like about Synlait's future

Are you just commenting on the daily share price ripple - or are you aware of any fundamental changes?

Just asking to understand whether you talk about the short term (hype-driven) future or the long term (value-driven) future of the company.

[winner (n)]

Are you just commenting on the daily share price ripple - or are you aware of any fundamental changes?

Just asking to understand whether you talk about the short term (hype-driven) future or the long term (value-driven) future of the company.

As I posted the other day its good they have stated what their 'ambition' is - like $2.55 billion in revenues in F27 and a return on capital of 15% (F22 ROCE was 5%).

Implies profits could grow at 25%/30% pa over the next few years

This Customer S must be about to start buying ... possibly hear who after Christmas (speculation)

So now I reckon about $4 is a fair short term fundamental value but as financials improve rerate likely.

So not much hype in talking about a $5 share price in a years time

Just have to get in early to make the most of what's to come

BP - didn't you load up at about 200/210 '''good on you

[BlackPeter]

As I posted the other day its good they have stated what their 'ambition' is - like $2.55 billion in revenues in F27 and a return on capital of 15% (F22 ROCE was 5%).

Implies profits could grow at 25%/30% pa over the next few years

This Customer S must be about to start buying ... possibly hear who after Christmas (speculation)

So now I reckon about $4 is a fair short term fundamental value but as financials improve rerate likely.

So not much hype in talking about a $5 share price in a years time

Just have to get in early to make the most of what's to come

BP - didn't you load up at about 200/210 '''good on you

Interesting.

Agree - ambitious goals are good, however after the A2M disaster there are in my mind still some clouds around the next big customer who will save the company. I guess, it can go either way.

And no, I didn't load up about 200/210 - not quite sure, when they have been that cheap. Have they?

I used to buy in (a long time ago) when they hovered above $3 ... and was quite impressed by John
Penno (CEO at that stage) and Nigel Greenwood (yes, he used to be CFO for Synlait) and sold out around the time it all turned pink. Didn't touch them since - despite liking to support local companies.

I think I would like to see their plan for the future and the business case around this big mysterious client before I buy back in. Sure, this probably means I am losing out on lots of hype, but it might save me as well from another client S bubble. 

[Left Field]

As I posted the other day its good they have stated what their 'ambition' is - like $2.55 billion in revenues in F27 and a return on capital of 15% (F22 ROCE was 5%).

Implies profits could grow at 25%/30% pa over the next few years.......

Will be interesting to see if what's good for SML will also be good for ATM (as 20% shareholder) etc etc??

[BlackPeter]

Will be interesting to see if what's good for SML will also be good for ATM (as 20% shareholder) etc etc??

What was ATM's average buy in price? Must have been around 10 dollars per share.

I recon lots of things must go right before ATM see at least their capital back ...

[winner (n)]

What was ATM's average buy in price? Must have been around 10 dollars per share.

I recon lots of things must go right before ATM see at least their capital back ...

Was $6.63 Peter

Only $140 under water but strategic investment ..... cheap as to 'secure supply'

[BlackPeter]

Was $6.63 Peter

Only $140 under water but strategic investment ..... cheap as to 'secure supply'

Are you sure? Their last (and quite big) buy in was at $10.90, which means that their first buy in must have been really cheap to get that average.

[winner (n)]

Are you sure? Their last (and quite big) buy in was at $10.90, which means that their first buy in must have been really cheap to get that average.

Here's what they've bought over the years

09/03/2017    14,634,119     at $3.27
13/08/2018    1,700,000     at $9.01
01/08/2018    14,840,527     at $10.94
23/03/2020    4,400,000     at $4.97
Nov 2020    7,777,863     at $5.12
TOTAL       43,352,509     at $6.63

[Basil]

What's $140 million between friends or associated companies, just a mere pittance lol
Then they go off and invest hundreds of millions more in their own stainless steel that's going to lose millions more every year until the late 2020's...heck you'd struggle to make this stuff up and write a more complete corporate fiasco short story if you tried....its more entertaining than watching the complete box set series of Faulty Towers lol.

[BlackPeter]

Here's what they've bought over the years

09/03/2017    14,634,119     at $3.27
13/08/2018    1,700,000     at $9.01
01/08/2018    14,840,527     at $10.94
23/03/2020    4,400,000     at $4.97
Nov 2020    7,777,863     at $5.12
TOTAL       43,352,509     at $6.63

Interesting - cheers. I didn't realize that they kept accumulating after filling their truck in August 2018. Who knows, maybe SML slipped too low on my current watchlist - or alternatively it is too high on theirs.

Time will tell ;

[Minimoke]

Announcement of new international customer way, way over due.

SAP implementation costing a fortune.

Still not much happening for me to want to delve any deeper into them

[Left Field]

A price sensitive announcement that there won't be much change in FY23 (revenue same as probably, but NPAT possibly down a smidgen.)

https://www.nzx.com/announcements/404539

Still no details relating to the much mentioned new BIG international customer.