Ann: Contract Awards, page-34

Hello Mr Pioupiou ….
I hope a dividend of useful substance will be paid, and also that NRW is currently swimming in liqidity.

…But I think the new policy as of last half yearly is to pay 40 to 60% of profit as dividends?
- While that $81M equipment sale must definitely add to the Covid-ransacked kitty, would it automatically add to profit ?


Yesterday’s UBS update, kindly shared by @6151 [here] (a postcode?) says NRW provided brokers with a balance sheet update?
(Was it this that caused the sell down today after a good news “sugar hit”?)

.. “Balance sheet update highlights challenging 2H21 but worst behind..
NWH Margins in Civil and Mining have been impacted by tight labour availability in the Pilbara
(1H21 A$15m Civil, A$12m Mining EBIT headwind).

We expect margins will continue to be impacted by productivity challenges in 2H21E, as key contracts complete.
This is highlighted in the recent balance sheet update, with net debt of A$115m implying A$-10m FCF in 2H21E.
The majority of this relates to Primero claims, primarily Wartsila, which in our view has largely been captured in the acquisition price.
Excluding this, we estimate 2H21E cash conversion of ~70% which is a reasonable outcome.
Recent state border closures continue to challenge the recovery profile into 1H22, however, with NWH’s major iron ore works complete, key labour headwinds are reducing.

We forecast FY22E EBIT of A$144m, up A$27m on FY21E, with A$15m of the uplift from margin improvement and the remainder from the Primero Acquisition….”

Sadly most of that is beyond my grasp.
But the half yearly [ref], said net debt was $96.5M - so that has increased by $118.5M ?

And (I think) UBS says it expects somewhere under $10 million in FCF (Free Cash Flow?) in this half?
- is that profit?


Further to dividends -
… FWIW (‘ware the maths!) I just tried to work out what possible dividends might cost;
On 456,368,520 shares
…..a 3c dividend would cost $13,691,055?
a 2c dividend - $9,127,370?
a 1c dividend - $4,563,685
All of those figures would require 40% to 60% profit beyond the spend?

I have run out of maths/estimation abilities here, but profit before tax was $40.3M up to December .…. Some of that might have been spent on costs before adding to the debt?
But maybe not as this is a good time to be borrowing?



Any thoughts and clarifications would be most welcome

cheers