analysts report out, page-19

some thoughts:

ASL had many years of strong growth and record net profits (FY 2005 -12 mil culminating in FY12 - 112 mil) which is quite remarkable.

in FY 13 it dropped 20% to 90 mil and this financial year's forecast is 35 mil which is a further 61% drop.

the return on equity at these levels is not great at 4% however if we can assume that the market has bottomed for ASL in accordance with management's expectations, then the return on equity based on the market cap (as opposed to the balance sheet of 12% is not terrible and if the business improves it could be a very good investment.

in summary, after some more research my view is now as follows:

1) recent contract awards look promising for future growth and rebounding in profitability
2)management has a great long term track record
3) discount to NTA provides margin of safety
4) roe at these levels is 12% and P/e ration of 8 isn't bad
5) dividend yield of approx 5% with prospects of improvement

so it looks like a decent investment with little downside and good upside potential

i'd like to hear other views.