Ann: 2016 Appendix 4E & Preliminary Final Report-BWX.AX, page-16

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vic_wattle

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16/08/16

15:41

Post #: 18530154
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Originally posted by Nano_Land ↑

Have to agree with Vic_wattle here

Solid result - market obviously expecting a beat of consensus numbers.

Result included around $500k or 5% after tax of R&D grant income, so a touch below reported growth.
Diluted eps also around 1.0cps or 8% below reported 14.1cps.

So guidance for FY'17 is ~17cps-18.5cps depending if you use diluted or undiluted shares.
PER as a result 27x-29x - pretty ritzy.

I say ritzy as ~70% of this groups revenue comes from one brand, albeit spread over increasing SKU's.
Also these guys earn 62% GP% margins - very-good but likely to come under pressure from their customers.
Will pharmacies who achieve 40-50% GP% like their suppliers achieving >60% for much longer?
…particularly when most of the COGS is water.
...and there will be an end to the mix shift from contract to self manufacture which is driving these margins.
Good to see Brexit not being used as a risk but in this case it must be given the UK dominates exports at present.
The A$ also just goes from strength to strength so they may lose some revenue in translation.

Balance sheet strong but a bit distorted by acquisition - working capital looks to be increasing nonetheless - ? to capital light model.

Think this will consolidate for sometime as a result of the above.

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Agree with your comments. Even if eps continues to grow by 25% for the next 2 years, the current price is likely to drift imo.

At $5:
Fy16 14.1 cps, pe 35.5
FY17 17.6 cps, pe 28.4
FY18 22 cps, pe 22.7

BWX Price at posting: $4.95 Sentiment: None Disclosure: Held
1 Upvote

0 Great analysis

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