SML - Synlait

[BlackPeter]

Was $13 a few years ago

Really cheap now

cheaper - yes, cheap? - Who knows?

Dividend yield: NIL; - cheap?
forward PE (if these optimistic analysts are right): 12.6 - not cheap for a agricultural stock
backward PE(10 years): 17.6: really not cheap for a quite boring agricultural stock;
SP is 137% of NTA,  of which lots is stainless steal (hard to sell). Hmm - cheap?
Debts are lower than they used to be, but still aver 50% of assets. Cheap given the lousy earnings?

Are you sure?

Maybe the still unknown white knight is printing dollars in the cellar ... and plans to use SML as money washing machine. They might be suitable for that job.

[mcdongle]

I suppose moving to nutritional drinks is something like this?

https://www.netpharmacy.co.nz/products/ensure-nutrition-powder-vanilla-flavour

[Hectorplains]

I suppose moving to nutritional drinks is something like this?

https://www.netpharmacy.co.nz/products/ensure-nutrition-powder-vanilla-flavour

They're looking more at what they call a "single serve, ready-to-drink, on-the-go product."  What we in simpler, less verbose, times referred to as 'cans" or 'bottles.' There was mention of them making a UHT coffee drink for an existing big brand customer under  a contract manufacturing arrangement in New Zealand and Australia. There was no mention of any sales projections.

It does sound more promising and vastly more scalable than their daft swappa bottle nonsense. 

[mcdongle]

 Ah Gotcha,  Found this.

https://www.kiwichemist.co.nz/products/ensure-twocal-hn-200ml-vanilla

[Minimoke]

Odd observation> I was coming back from the coast the other day and two Synlait tankers heading up over Arthurs towards the coast. One was grinding up the hill really slow. As if it was chock full of milk. No idea what they were up to.

Just come back from another trip away. This time coming over the Lewis. And what do I spy near Hanmer - another Synlait truck. This is about 3 hours away from Dunsandel. So I'm wondering just how far afield do tankers go to get their milk?

Still no news about the big "new international customer" - an announcement way, way over due. SP yesterday $3.56

[Hectorplains]

Just come back from another trip away. This time coming over the Lewis. And what do I spy near Hanmer - another Synlait truck. This is about 3 hours away from Dunsandel. So I'm wondering just how far afield do tankers go to get their milk?

Still no news about the big "new international customer" - an announcement way, way over due. SP yesterday $3.56

1. I'm not sure on the geographical distances but they have around 220 South Island farms supplying them.

2. In regards to the much touted "International Customer" the commercial production for them has been announced as starting in "early" 2023.  'Early' can be a bit like 'imminent,' it's meaning being fairly fluid.  Certainly they still appear to be in no great hurry to break the news and name the company. 

Their share price has edged up a tad - hovering in the mid 360's.  An end to the 'pin the name on the donkey game' might provide some upward impetus - even if only briefly. 

[mcdongle]

Synlait can only name the Company, When the Company says they can, That is part of the deal.

[Minimoke]

Synlait can only name the Company, When the Company says they can, That is part of the deal.

Synlait first announced the "established, global category leader" back in November 2020. They stated they would need a $70m investment in processing and packaging customisation. And that they expected production to start mid 2022.

5 days later they went to market seeking a $200m capital raise. In part to fund this new "established, global category leader"

And since then silence on where this money has gone and who it is being spent on.

That is simply not good enough.

(And if you now have just 2 big customers why would you need to spend all that money on SAP?)

[Auto Rower]

Synlait can only name the Company, When the Company says they can, That is part of the deal.

Fair enough cannot blame synlait for keeping to the agreement ,certainly has dragged on a bit !!!

[Minimoke]

Ah Gotcha,  Found this.

https://www.kiwichemist.co.nz/products/ensure-twocal-hn-200ml-vanilla

Thats an Abbott product

[Minimoke]

Yawn - they have published another "sustainability Report" today.

Dont be fooled that it addresses the sustainability of their share price.

No word on how energy and related costs have gone up.

And still no word on their new international customer.

SP opens today at $3.53

And sorry Synlait - you are making zero impact on global carbon emissions - they are still going up. And we arent going to hell in a hand basket

[Sideshow Bob]

No doubt Synlait's customer would have expectations or requirements that Synlait measure, reduce, eliminate, mitigate their environmental emissions and footprint. Just as Synlait's customer customer would have expectations.

All dairy companies will be doing this to a greater or lesser degree. Does it mean they get more money for their products? Probably not. But just a cost of doing business.

[Minimoke]

No doubt Synlait's customer would have expectations or requirements that Synlait measure, reduce, eliminate, mitigate their environmental emissions and footprint. Just as Synlait's customer customer would have expectations.

All dairy companies will be doing this to a greater or lesser degree. Does it mean they get more money for their products? Probably not. But just a cost of doing business.

I've just looked at FCG Fonterror Co-Op shares and no such reports from them in the past few years.

[Sideshow Bob]

I've just looked at FCG Fonterror Co-Op shares and no such reports from them in the past few years.

https://www.fonterra.com/content/dam/fonterra-public-website/fonterra-new-zealand/documents/pdf/sustainability/2022/fonterra-sustainability-report-2022.pdf

[BlackPeter]

Yawn - they have published another "sustainability Report" today.

Dont be fooled that it addresses the sustainability of their share price.

No word on how energy and related costs have gone up.

And still no word on their new international customer.

SP opens today at $3.53

And sorry Synlait - you are making zero impact on global carbon emissions - they are still going up. And we arent going to hell in a hand basket

Actually - the last market update was only one month back .... I guess you can't really complain that they don't keep their shareholders up to date, can you?

Here it is if you missed it:

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

Admittedly - it all sounds a bit soft ... but maybe soft is good (as in "fluffy"?) ... and they are clearly softening up their share holders. Pink - soft - fluffy - Synlait. All good.