It may have some long term potential but I see it tracking lower for a long time yet and any potential turnaround is so far off and so full of risk that we’re in the land of pure conjecture.
This is a boom time business that had been doing around $500m to $700m at a blended margin across the business (construction and village) of something like 20%. It’s AGM commentary suggests it’s heading towards $300 to $500m at something like 10% and not coming back any time soon. i.e. as much as $100m in margin missing with the end of the boom. This is a deeply worrying picture, especially when the management team appears to have no demonstrated and relevant track record.
The CEO, whose biography suggests he has never worked anywhere but Decmil, has watched the boom come and go and the SP is back where it started in 2009. So Decmil then goes to shareholders to ratify a new incentive scheme, on the basis that the previous one wasn’t working because not many shares were vesting to the CEO. But of course the shares weren’t vesting because the business has been in a pretty consistent slide down to 6 year lows.
I make no comment re the potential nepotism, maybe it’s just clouds having a silver lining, and maybe it’s a rumour spread by some of the many workers who have had salaries and careers jeopardized by redundancy while upper management is left untouched.
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It may have some long term potential but I see it tracking lower...
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