I have met with management. I think that this stock has simply...

I have met with management. I think that this stock has simply been caught up in the mining services bucket. I think the market needs to see this year out before deciding which mining services business models hold up in current environment. I believe that this is trading on a 3-3.5 times EV:EBITDA ratio and is cum growth (can't get me enough of this!). I am still buying despite already being a large shareholder. To say I'm overweight is an understatement.

This company does not rely on new mine development, although it does not hurt. Their business comes predominantly from the outsourcing (previously undertaken by mine management themselves) of water management by the producers. Need to understand that as mines get older they get deeper, and water management becomes a greater and growing issue. Unless they close all mines and allow flooding and loss of mine infrastructure, then we will be fine. To date there are no credible rivals to RQL in terms of expertise and ability to deliver. Aka their assistance to the effort to cool the Fukushima reactors following the tsunami, or their current heavy workload at Yallourn energy where they are diverting 60,000 litres of water per second whilst the river levy banks are restored. I see them as becoming a 1st tier supplier to majors - these guys are very good at what they do. So for RQL there is still plenty market to win over from exisiting producers outsourcing. Indonesia is promising, but possibly not without local challenges in terms of contractual dealing and the logistics of operating in Indonesia, but be aware that Indonesia output is growing, they are a low cost producer, and they have enormous water issues.

In 5 years time I plan to sit on a beach in Brittany sipping on a good champagne whilst thanking RQL for the opportunity to reflect on good fortune! My only fear is that some opportunistic capitalist seizes the opportunity to cut my lunch!