Chaddy36, thank you for the reply. From my conversations with other colleagues within the industry (here and overseas) the sovereign risk (resource tax) and carbon debate is causing a lack in confidence, and companies they work for or run are finding it very hard to raise equity. Please see comments made by Major Drilling on those issues and see how Australia is a further 10% off other regions (I agree with your hypothesis, but you need to change the global market not just our government). However as BLY is a global company and directly impacted by the decrease in amount of equity raised on the markets for mining and exploration, BLY fortunes will not turn until the industry specific equity market does (if you are trading through a good broker, some will tell you the percentage of industry equity raised to equity sort – it’s a telling figure!!). Then it is in what shape BLY finds itself when money starts to come back into the industry.
I believe that we will see stabilisation in their SP once completion of the (probable but yet unannounced) CR. They also need to prove that they are sustainable with 50% (or less) utilisation.
stock4dummies, there is no need for me to bait, BLY’s own announcements of their position is enough. As for “chickens” I’m not sure what you mean, but please find a BLY “SELL” recommendation from a broker and their explanation.
“Organic growth for drilling services is leveraged to the commodities growth cycle which is volatile and cyclical. The Global Products business has been rationalized with the closure of some facilities, which has improved manufacturing margins. Long term success depends on successful diversification away from minerals exploration and into other growth areas such as environmental and infrastructure drilling. Boart Longyear reported NPAT down 57.4% to US$68.16m for the year ended 31 December 2012. Revenues from ordinary activities were US$2.01bn, down 0.4% from last year. Diluted EPS was 14.8 US cents compared to 34.8 US cents last year. Net operating cash flow was US$64.21m compared to US$197.7m last year. The final dividend declared was 1.0 US cent, taking the full year dividend to 7.4 US cents compared with 10.4 cents last year.”
They have a 12 month target of $0.78, I believe optimistic but in line with BLY’s announcements so far.
Till August, good luck and best wishes.
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