Reporting Season Summary: 26 August 2014
About the author:
- Author name:
- By Fiona Buchanan
- Job title:
- Co-Head of Research, Senior Analyst
- Date posted:
- 26 August 2014, 2:48 PM
- Sectors Covered:
- Property, AREITS
PS&C (PSZ)
Results
EBIT: $6.7m; Dividen 3cps
The result was in-line with expectations.
Morgans comment
PSZ's FY14 result was inline with guidance provided in June. They reported normalised EBIT of A$6.7m (vs our A$6.6m forecast). On our estimates this equates to 24% EBIT growth yoy (on a normalised basis). PSZ remains a value play in the IT services sector. In addition to being cheap it is growing earnings at a healthy rate and is small enough to undertake meaningful value and earnings enhancing acquisitions. Add recommendation.
Ingenia Communities (INA)
Results
NPAT: $11.5 million; Dividend 1.15cps
The result beat expectations.
Morgans comment
A strong result from INA, in spite of the lower ALE settlements as previously guided by management. The rental income from each asset group was solid and bodes well for FY15. INA’s share price has been subdued more recently, likely anticipating another ALE miss in the near term. INA now has 7 ALE projects in delivery mode with a few more about to start ordering. Add recommendation.
Southern Cross Electrical (SXE)
Results
NPAT: A$7.7 million
The result was in-line with expectations.
Morgans comment
SXE's FY14 result will likely disappoint but record order book should offset disappointment, albeit FY15 margin pressure likely to lead to minimal change to our FY15 NPAT. SXE is a late cycle electrical & instrumentation (E&I) contractor so cycling off tapering large construction activity will need close utilisation management. Services are well suited for operations and maintenance work, but at 12x FY 15 PE growth already looks factored into the price. Hold recommendation.
Senex Energy (SXY)
Results
NPAT: A$37.9 million
The result missed expectations.
Morgans comment
We believe the market was looking for growth in the FY15 outlook. The targeting of 200%+ reserves replacement in FY15 is strong. The change in FY15 production guidance to exclude exploration may appear disappointing initially, however the reserves replacement expected growth suggests that oil success is expected in the drilling program, though tie in to production may have variable timing. Drilling of 25+ wells in FY15 plus initial gas production and testing of conventional gas in the Cooper Basin should provide plenty of news flow. Add recommendation.
Virtus Health (VRT)
Results
NPAT: A$30.9 million; Dividend: 14cps
The result was in-line with expectations.
Morgans comment
VRT posted FY14 results NPAT of $30.9 (our forecast A$31.4m), EBITDA of A$59.4m (our forecast of A$62.0m), revenue of A$201.2m (our forecast of A$198.6m). A final dividend of 14cps (our forecast 12 cps). Outlook commentary was positive but subjective. Market may be a little disappointed. Add recommendation.
Fleetwood (FWD)
Results
NPAT: A$3.4 million; Dividend: 2cps
The result was in-line with expectations.
Morgans comment
Today's result was reasonably well guided and provided few surprises other than lower debt and better than expected dividend. In our view, the 2H run rate across both MA and RV is likely to see us (and consensus) downgrade our forecasts. While the group has won a number of significant contracts for 1H15 which should help support revenue, we find from an earnings perspective little to get excited about in the near term. In our view, there is still a long way to go for FWD to be turned around and with earnings certainty remaining cloudy we find better places to be. Hold recommendation.
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