the faith in nms, page-15

re: the faith in nms binone Cheers Mula .... I can respect your thoughts.
From my point of view however, it may be faith, but not entirely "blind faith". I call it "faith drawn from my own sound research"...

My only concern for NMS's future is that any add on businesses they plan on buying now or in the medium term are fully priced at this stage of the economic cycle and will have potential to add excessive overheads IF there is any dramatic slowdown in world economies in future.

If the newly acquired businesses are well utilized by the company in the near/mid term however, and acquired as necessary "tools and resources" for NMS to get the projects they want for a bigger slice of the pie, then the few million they spend here and there on dive, ndt, inspection, etc businesses (over priced or not) is going to make little difference to the overall long term picture. (This is in no way saying that what they are paying for the recent dive services is too much ! I don't know at this stage.... With Lange there, I am sure it will be a fair price with fair due diligence done beforehand.)

While a lot of money is obviously going to be pumped back into the company over coming years before any of us see actual dividends, I would guess that the earlier proposed projected profit of less than 16% is way (way!) on the light side. A better indicator for judging the business's future at this stage would be to just judge the percent margins on jobs IMO. This would give a better impression of what the future holds in terms of chances of supporting underlaying operations. Additionally, the percentage margins achievable on small jobs now give an idea of what's achievable when the actual numbers (not just percentages) and price tags for jobs are far bigger in future years.

For instance, it was said at the meeting that the RA navy had saved approximately a million bucks on the two small jobs NMS did for them earlier. Meanwhile, NMS reportedly maintained very healthy percentage margins for the projects. If they can provide that sort of saving for customers AND good percent margins for small jobs, imagine the situation for maintaining roughly similar percentage margin for larger jobs. That becomes big $$ numbers, even with reduced "percentage" margins. And all before they even start to compete on price with others in the field.....