Over the past few days a number of mining services companies have released guidance to the market that they will not meet earnings expectations...AJL, WDS etc.
In light of this I have been reviewing by BLY holding to assess whether to sell prior to results release date on Feb 19.
In the halfyearly results presentation BLY gave the following 2009 guidance: - Full year revenue to approach 50% less than 2008 (1st half 2009 $463m, 2008 full year $1,839m) - Full year EBITDA margin to be approx 13% (1st half 2009 13.6%) - On these assumptions guidance suggested a full year adj EBITDA margin of around $120m (1st half 2009 $63m). - Reported first half NPAT was -$5m (+$3m after adjustments).
In my opinion BLY will deliver on this 2009 guidance (where AJL and WDS certainly didn't).
My question however is what is the market expectation. Is the market expecting BLY to merely hit this guidance, or is it expecting more?
If it's expecting more I'd be inclined to sell and purchase again after results are released. If it is expecting previous guidance from management I will hold as I think BLY will over-deliver on that to a small extent.
BLY Price at posting:
$3.35 Sentiment: LT Buy Disclosure: Held
