2022 General News etc, page-83

So Monadelphous and NRW both released their H1 reports last year on 18/02/21
… which may not have been an accident?

And now according to The West, Goldman Sachs have released an update with a sell recommendation on MND :/
It says the market may have underestimated just how tough things are in WA at present and cites an expectation costs will have risen .

“Goldman Sachs has a sell on Monadelphous and is tipping a half-year profit that is 6 per cent under market consensus.​

“Given that (the) majority of Monadelphous’ engineering and construction order book is on fixed price contracts and (a) sizeable proportion of its workforce is fly-in and fly-out, we believe that the street is underestimating the impact on its margin in the near term,” the analysts said.​

It also says this state off affairs was forewarned ny Monadelphous at its annual meeting in November when it  also warned it would continue regardless of  WA border restrictions being  loosened.

See full report;

Spoiler : Glass half empty MND, MIN expectations from Goldman Sachs

https://thewest.com.au/business/min...as-potential-profit-disappointments-c-5600047
Mineral Resources, Monadelphous seen as potential profit disappointments


Sean SmithThe West Australian
Mon, 7 February 2022 2:57PM
Comments
Sean Smith


Monadelphous chairman John Rubino, left and managing director Rob Velletri at an annual meeting. Credit: Nic Ellis/THE WEST AUSTRALIAN


Mining and services company Mineral Resources and construction and engineering contractor Monadelphous have been included in a list of companies at risk of bombing during the reporting season.

Investment bank Goldman Sachs’ analysts have warned that the market may have underestimated the impact of WA’s labour squeeze and rising costs on the two stocks.

Goldman Sachs has a sell on Monadelphous and is tipping a half-year profit that is 6 per cent under market consensus.
“Given that (the) majority of Monadelphous’ engineering and construction order book is on fixed price contracts and (a) sizeable proportion of its workforce is fly-in and fly-out, we believe that the street is underestimating the impact on its margin in the near term,” the analysts said.

Monadelphous called out the shortage of skilled labour at its annual meeting in November, describing it as the “big brake on capacity” and warning it would likely continue plaguing the contractor for some time even when WA’s border restrictions were loosened.

With MinRes, Goldman Sachs analysts said they were concerned the company’s interim profit would be hurt more than expected by rising costs “as a result of labour and resourcing tightness, potential supply chain constraints, and broad cost inflation being experienced by the mining industry”.

Goldman Sachs’ estimate of the company’s first-half earnings are 16 per cent below average market forecasts.

The bank other potential profit disappointments are Commonwealth Bank and online furniture and homewares group Temple & Webster.

On the other side, it lists Perth-based Iluka Resources as a stock whose profit announcement could better market expectations, along with media group Nine Entertainment Corp, metals recycler Sims Metal, salmon exporter Tassal Group, HealthCo Healthcare and Wellness, Jumbo Interactive, appliance maker GUD, Sonic Healthcare and Domino’s Pizza.

Commsec says Goldman Sachs does not cover NRW Holdings.
FWIW at our November AGM [ see presentation announcement here ] Jules was not so gloomy.
Back then he saw concluded projects in the Pilbara as causing greatest pain and felt there was opportunity to roll the NRW workforce existing at that time into new projects as old ones concluded.

But I note there are still plenty of positions at Karara  being advertised.  Yet at  the AGM he expected no difficulty in finding workers there due to good shifts, good camp and close proximity to Perth…

*sigh*

cheers