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AZG - Allmine Group

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The Allmine Group is one of Australia's largest mining and industrial machine maintenance businesses. It is the "One Stop Shop" for machine maintenance requirements, with services including:

  • Mechanical and Electrical services (including air-conditioning);
  • Engineering, boiler maker/welding and lineboring services;
  • Consumables, including components to suit Caterpillar ®, Komatsu ®, Hitachi ® and on-highway trucks; and
  • Specialised product, including the manufacture of access ladders, water tanks, mine specification and other specialised vehicle builds.
The Allmine Group services its clients with over 150 specialised tradesmen, 5 strategically located workshop facilities, and a fleet of over 70 service vehicles and trucks.

http://www.allminegroup.com
 

McCoy Pauley

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This company floated on 28 February 2011 and saw a stag profit on the opening day. Price has come down in the last couple of days.

It has come to my attention by being talked up on Your Money Your Call last night by one of the expert panellists (not Mark Morland, the other one).

L1 Capital Management has become a substantial shareholder in AZG recently.

The IPO was issued to pay down debt and to raise capital for further acquisitions. Looking at the financial statements for the last financial year, it seems to me that they had $9 million in debt, which is a substantial amount given they had equity of $10.18 million as at 30 June 2010.

Despite the fact that capital was raised to pay down debt, AZG disclosed in its report that its total current interest-bearing liabilities had risen to more than $11 million by 31 December 2010, probably due to the fact they borrowed money to acquire companies.

Superficially appealing but I'm concerned about the high level of debt this company owes to its creditors, compared to its equity.
 

Ken

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hi,

just think this one is worth revisting.

Anyone have an opinion on AZG, I have seen it is still being pumped up on your money your call.

any thoughts?
 
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This stock has fallen very hard from its high at $0.23...now down to $0.145.

Mining service is not a great place to be at the moment with alot of uncertainty around...

It seems that the smaller players such as AZG are just getting smashed as they would be the first to go under if things get really bad.

Still worth keeping an eye on this one tho IMO...
 

skc

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This stock has fallen very hard from its high at $0.23...now down to $0.145.

Mining service is not a great place to be at the moment with alot of uncertainty around...

It seems that the smaller players such as AZG are just getting smashed as they would be the first to go under if things get really bad.

Still worth keeping an eye on this one tho IMO...
Cash flow is a big problem with these guys. When times are good they can probably managed but if the work flow stops they are the first in trouble.

There were semi-reasonable reasons why some mining services went down substantially during the GFC...
 
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Yeah, CF has only just gone positive...wouldnt take too much for it to turn neg again...
 

skc

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Yeah, CF has only just gone positive...wouldnt take too much for it to turn neg again...
Cash at end of quarter -$5.5m or so. Plenty of businesses started with running on a credit card but it's probably not the most conservative way.
 
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Cash at end of quarter -$5.5m or so. Plenty of businesses started with running on a credit card but it's probably not the most conservative way.
And probably not too many listed companies manage to run on credit card limits!

I consider myself fortunate to have avoided this one. AZG looked so promising a year or so ago.

:22_yikes:
 

skc

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And probably not too many listed companies manage to run on credit card limits!

I consider myself fortunate to have avoided this one. AZG looked so promising a year or so ago.

:22_yikes:
Actually traded this from 14.5c to ~20c back in Feb when it was easy money going long any mining services share. Most of these are back to Feb levels now.
 
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It doesn't seem like there is too much interest from the forum in regards to this particular stock.

Very interesting day. Stock gapped up and I missed my entry at 0.15. Trading halt with rumours of a takeover at 25c which had me a bit annoyed. But not to be.
 
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It doesn't seem like there is too much interest from the forum in regards to this particular stock.

Very interesting day. Stock gapped up and I missed my entry at 0.15. Trading halt with rumours of a takeover at 25c which had me a bit annoyed. But not to be.

Will probably fall back to below 15c tomorrow but there has been an increase in volumes the past week or so, take over rumors aside. The next few weeks will be interesting if anything concrete happens regarding the take over rumors.
 

skc

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It doesn't seem like there is too much interest from the forum in regards to this particular stock.

Very interesting day. Stock gapped up and I missed my entry at 0.15. Trading halt with rumours of a takeover at 25c which had me a bit annoyed. But not to be.
It's a stock I've traded in the past and watch with casual interest.

Since you are trading the technicals I didn't want to bore you with the fundamentals.

Even though it is trading at at super low PE (something like 3x) it's in a dog sector at the moment. Plus it is running on a -$5m cash balance so it doesn't have a great deal a equity buffer. It's not investment grade but a possible speculator.

I don't think the takeover rumour has any legs. There's no reason to take over any mining service companies because there are little syngeries and you are really just buying their contract revenues (which should be appropriately priced). But who knows? (Except those who bought a few days ago seem to know something).
 
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Goodnight...

Mining services company Allmine Group has appointed administrators and its chief executive has resigned, effective immediately.

Statements to the Australian Securities Exchange by the company confirm that Paul Kreppold has stepped down and joint voluntary administrators David Hurst and Kim Strickland of WA Insolvency Solutions appointed.

A range of mining services contracts have downgraded earnings forecasts in recent weeks, in signs the mining investment boom is slowing.

Profit warnings have been issued by WorleyParsons, Boart Longyear, Transfield Services, UGL, Bradken, Ausdrill, Fleetwood Corporation and NRW Holdings.
http://www.afr.com/p/business/companies/allmine_group_ceo_resigns_appoints_7CbmmMnuCkS278Pb0yFdzI

I'm sure they won't be the last.
 
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