Their low cap ex spend going forward and sluggish profit growth profile outside of acquisition would indicate that increased cash flow can only go to debt and divies......
Paying down debt is actually a pretty good deal at the moment......clearly the bankers hate them.....I worked out a while ago ckl pays about 8% interest which seems a little high to me
So with another $2.5 mill off the debt this half, that's additional pretax profit annually of 200k just from interest savings....but surely the banks will give them a better rate as the company further shows its stability
As divy payout is currently under 50% of eps, and cashflow is tracking higher than eps, due to lower cap ex......the divy of this has a long way to go up
I'm loving this stock and hope it does not go up!!
CKL Price at posting:
51.0¢ Sentiment: None Disclosure: Held
