I was a bit spooked with the results at first but actually all...

I was a bit spooked with the results at first but actually all appears quite ok - despite the share price.

Key points

• Revenue still strong at $809m for the half and expecting $791-$841m for the second half
• EBIT (A) $46.9 for half and expect $95-100m for full year. More than double
• Underlying NPAT $31.7m for half so based on revenue and EBIT (A) outlook above, then would conservatively expect double for the year, say underlying NPAT $63m
• Underlying NPAT of $63m fcast for full year with current Market cap of $355m is a PE of just 5.6 !!! On that metric it is highly undervalued.
• Cash flow generation looks ok with operating cash flow for half of $96m
• Gearing is 31% whilst high is not problematic
• EBIT (A) margin was down for the half to 5.8% and they cited covid and increasing costs. They target future EBIT (A) margin (not exactly sure when) to be 8% which if realised will generate much better bottom line results.
• Order book great at $5.2B and lots of potential given the tender pipeline of $8.7B
• Batu Jijau project wording sounds very positive to me " we now expect to finalise in FY22 with commencement in FY23"

PE of 5.3 and outlook still positive.