Nice find Kwaidan, you'd think the company would want to release...

Nice find Kwaidan, you'd think the company would want to release any positive news at the moment, no matter how small the job.

Huntley has re-rated Ausenco to a speculative buy, here is their report for those that are interested:

AAXs recent profit downgrade highlights the very high-risk nature of mining services. We tend to stick with the larger, well diversified groups and ignore small volatile players who tend to under perform in tough times. One would have thought AAXs commodity and geographic diversity would see it perform much better than others, particularly given its very large pipeline of potential projects. Positive outlook commentary from management and the recent steady flow of contract wins, combined with broader economic recovery, were key catalysts for positive market expectations. Those expectations were shattered with last weeks profit downgrade. Unfortunately AAX continues to lag and will lose money in 1H10. Others are pushing ahead and posting steady earnings from a disastrous FY09. Managements ongoing promise of better times ahead is now very difficult to trust. Solid results are needed before market confidence is restored. Our business risk rating is increased from High to Speculative. The stock doesnt suit even those with an above-average risk tolerance, instead it is only suitable those who trust managements ability to ride out the downturn and deliver on new promises. AAX could emerge from the downturn later than others, possibly six months or so, and resume growth at very high levels but we just dont have the conviction at this stage to blindly trust those ambitions. We like the overall concept, particularly the exposure to very attractive long-term macro fundamentals, but we just dont know if AAX is still capable to delivering under current management. There is also a real risk of longer term structural and operational deterioration. This is difficult to quantify but we assume some damage is inevitable. The first real disappointment was the Lumwana fire at Equinoxs Zambian operations in mid 2008, fully-priced acquisitions at the top of the market and now the failure to recover in-line with the industry. 1H10 revenue is expected to range between $200-230m but the group will report an after-tax loss of $9-13m. This includes one-off pre-tax office closure costs and lease provisions of $7.5m. Possible intangible impairment is under review and not included in this guidance. 1H10 EBITDA slowed from the 2H09 run rate. This is very disappointing. Results are complicated by exchange rate volatility and low utilisation rates. AAX says higher tender costs and resource capacity holding costs are to blame. Guidance is for 2H10 revenue growth of 15-20% and EBITDA of $38-45m. This is significantly below our prior estimates. Revenue guidance is slightly below prior expectations but margins are a lot lower. FY10 NPAT guidance is $13-$18m when including the non-recurring items. Our FY10 and FY11 NPAT estimates adjusted to non-recurring items are $22.7m and $37.2m respectively. Our FY11 estimate is based on EBITDA of $64.7m which assumes the 2H10 guided run-rate falls back in 2H11. Its worth noting 2H10 guidance is not far from the 2H08 peak of around $47m so there is upside to our numbers should the trend materialise. We move our recommendation to a Speculative Buy below $2.30 where the stock trades on a revised FY11 PER of 7.5x hardly demanding given the low earnings base we use. Things could go either way and further downside is possible. Mining services stocks are often traded on sentiment which at the moment is weak. Our valuation falls to $3 due to the earnings changes and a sharp increase in our cost of capital now at 13.5%. The higher discount rate reflects the very-high degree of uncertainty. We re-iterate our prior caution that any set of earnings estimates, particularly long term forecasts, are at best a guess and should only act as a guide rather than certain numbers. We generally have more confidence in forecasting earnings for higher-quality industrial companies than very-high risk mining services groups.