Tough times all over …
My buy order was taken out at open and now Adbri is trading even lower, so fingers crossed for a close over $1.59 and a quick bounce to higher values!
From the announcement:
… “Changing market dynamics means Adbri needs to increase focus on driving efficiencies and costs to improve margins. Mark is well-placed to drive this disciplined agenda given his executive track record, while continuing to deliver on our previously outlined Net Zero Roadmap.”
…. Update on trading
Despite the actions taken to address inflationary pressures, these measures have not offset external headwinds.
Earnings have continued to be impacted by ongoing wet weather conditions affecting volume and cost, and an escalation of input and operational costs.
The Company expects to record an underlying net profit after tax (excluding property and significant items) of $75 – $85 million for the full year ended 31 December 2022.
The demand environment has remained robust, however extreme rainfall events and ongoing inflationary headwinds, particularly energy and diesel costs, have continued to impact margins. While Adbri has implemented out-of-cycle price increases, they have not met ongoing cost inflation.
The Company is implementing a number of immediate measures in response to the current operating conditions including:
• a critical review of expenses to deliver further additional cost reductions;
• focusing on operational efficiency improvements;
• reviewing key supplier and customer contracts for repricing opportunities; and
• accelerating its strategy to divest surplus land to realise value and recycle capital.
The Board believes that the appointment of Mark Irwin as interim CEO will accelerate Adbri’s ability to deliver these initiatives in the current environment.
Adbri retains substantial balance sheet flexibility, with access to liquidity to fund its operations and capital investment priorities (including the Kwinana project), having previously extended its banking facilities.
It seems like the company is a wounded takeover prospect?
But at what price ?
