early breakout warning, page-5

Hi Gung-ho,

Recently, I posted some of my thoughts on which sectors would perform this year. I singled out both the media sector and the developer /contractor (but not, residential) sector. I also commented on which stocks within those sectors I favoured, and which, I did not.

In the case of MAH, I took a neutral approach, and this is where I remain.

I have not yet been tempted to invest in MAH and would need to see the 1st half results in order to be assured of the sustainability of their turnaround.

In addition to the co-incidence of timing associated with the cessation of Paradice as a SSH, MAH is associated with the Darwin to Alice railway line.

Construction of the rail link apparently is progressing well and, by all reports is either within stated timelines and /or within budget. Completion of the rail-link will be a good bonus for MAH (ie: from a construction effort perspective).

But, whilst the rail-link contributed heavily to profits in FY02/H2, and will again do so in FY01/H1 and in /H2, the reality is that MAH's forward order book is not looking as strong as it should (ie: insufficient replacement work for completed projects).

So, what am I looking for in the H1 results?

I am looking for the following:
1)
sustainability of underlying profit improvement;
2)
progress update on the Darwin-Alice Springs rail-link;
3)
progress update on the nature and quality of MAH's forward order book; and
4)
guidance on the full year outcome, having regard to the current economic outlook, etc.