More on Bingo’s fundamentals and another perspective on the...

More on Bingo’s fundamentals and another perspective on the recent investment day ... this time from a relatively unknown, yet  highly regarded by ‘those who know’ fund manager. ( In the same way there are certain restaurants the best off duty  chefs like to head out to so it is with funds?)
The company is OC Funds led by Robert Frost and this is from the June 30 update on it’s Dynamic Equity Fund
https://www.copiapartners.com.au/wp...190630-OC-Dynamic-Equity-Fund-Fund-Update.pdf

“...Bingo Industries (BIN, +47.7%) rallied strongly during the quarter as the market became more comfortable with the recent acquisitions, management’s ability to hit the revised earnings guidance for FY19 and the likelihood of meaningful price rises in the NSW market following the introduction of the $70 per tonne waste levy in Queensland.

BIN is seeking put through price rises of 20- 25% in NSW in response to increased costs and greater demand for landfill and recycling capacity following the introduction of the Queensland levy.
The extent to which these price rises stick remains unclear at this stage, but we note that several of BIN’s key competitors have announced their intention to increase prices and Sydney landfill prices look set to rise materially in the coming 12 months which will certainly make discussions with key customers a little easier.


We attended BIN’s investor day in late June which showcased both the newly acquired Eastern Creek Recycling Ecology Park and the Paton’s Lane landfill and recycling facility, both of which are state of the art and on track to make meaningful earnings contributions in FY20.
The integration of Dial-a-Dump is well progressed and the $15m synergy target has been maintained.
The ramp up at West Melbourne is going well and we recently undertook a site visit and were impressed by the quality of this facility.
No doubt a softening residential market remains a key headwind but the ramp up in infrastructure related waste ought to provide some offset.

BIN owns a suite of quality assets that are difficult to replicate, particularly the NSW landfill assets, which are a major competitive advantage given that the government is unlikely to approve further landfill sites in the greater Sydney region any time soon.

The stock remains a core portfolio holding.”