GS "Although volumes from Lyttelton in isolation appear weak, we also consider data out of Auckland, which we see as becoming an increasingly meaningful contributor to SM1’s IMF volumes and increasingly, a large portion of volumes for A2M. Although SM1 is not the only IMF manufacturer exporting in this region, we continue to highlight a steady increase for the four months through Sep-19, with volumes declining slightly in Oct-19. However, we note in Nov-19, volumes have increased on a MoM basis (+9%, vs. -24% in Oct-19). We note there were no exports recorded in Nov-18, so we do not have a YoY comparison. On a rolling 3-month and 6-month basis, total volumes from Auckland are +903% and +423% YoY respectively."
"Total IMF volumes from Lyttelton and Auckland combined on a rolling 3 month and 6 month basis are +15% YoY and +31% YoY respectively, which we see as broadly supportive of overall trends and our forecasts for A2M and SM1, however, given month-to-month volatility as a result of shipment timing, we do not use this data as a proxy for our forecasts."
" We continue to forecast total IMF volumes for SM1 in FY20E of 52k MT."
SM1 Price at posting:
$8.57 Sentiment: Buy Disclosure: Held
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