So no major change in terms of what they communicated at the half year (at least $45m in total revenues for FY2023), but the big question is what margins will they generate on these contracts?
They seem to have running costs of 10-12m, and their Cost of Sales must account for most of the employee costs which must be running at ~12m (~110 employees).
So the big question is whether the margin on that ~$33m in revenues in 2H will cover the cost which I roughly estimate at ~12m in expenses (say 6m for CODB and 6m for employee expenses).....you would need a 33% margin.
The positive is that they still have a further 50m in order backlog for next year (just in subsea business) so that should result in a profit next year and give them time to continue to beef up that order book.
MCE Price at posting:
33.0¢ Sentiment: Hold Disclosure: Held
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