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SND - Saunders International

Discussion in 'Stocks Q-Z' started by So_Cynical, Oct 22, 2009.

  1. So_Cynical

    So_Cynical The Contrarian Averager

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  2. So_Cynical

    So_Cynical The Contrarian Averager

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    Saunders is branching out paying about 6.2 million for a bridge builder called Civilbuild, mostly cash and will issue a few shares.

    http://www.civilbuild.com.au/

    Civilbuild has annual revenue of around 22 million thus will be see substantial lift in group revenues, margin pressure continues and the dividend has been cut, a buying op may present soon.

    http://clients3.weblink.com.au/pdf/SND/01832755.pdf
     
  3. galumay

    galumay learner

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    I read that this morning, So_Cynical, I suspect it will work out well for them. SND is another one of those little businesses, that although listed, is really run like a private company. Without any inside knowledge, my guess is SND have been looking round for some time for another private business to expand and diversify with. Given their conservative style I suspect management will have made sure this deal has been done at a price that reperesents real value for SND. It will all probably take a while to play out, but hopefully we see a return to the sort of returns generated back in the resources boom!
     
  4. So_Cynical

    So_Cynical The Contrarian Averager

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    I think there will be some skepticism because SND hasn't done this before, however its not rocket science and Civilbuild are a small specialized outfit much like Saunders so should be a good fit, short term i think we could see some share price weakness.
     
  5. galumay

    galumay learner

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    I agree with all of that, i paid around 70c a few years ago when I first got in, I will probably take this opportunity to top up a bit and average down.
     
  6. So_Cynical

    So_Cynical The Contrarian Averager

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    Saunders are doing a rights issue, 1 for every 8 held with a record date of 15 Sept ~ 50c per new share.

    http://clients3.weblink.com.au/pdf/SND/01893191.pdf

    This is the first cap raising in 8 years and once completed SND will have about 104 million shares on issue, all in all fairly conservative and far from over the top, and 50c is about where you would want to be buying anyway.

    i will participate.
     
  7. galumay

    galumay learner

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    Me too! Its been a good couple of weeks for me, the NWH SPP & now this rights issue with SND. Such a well managed little business, very happy to hold.
     
  8. galumay

    galumay learner

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    A very healthy HY report this morning, profits growing faster than revenue whuch is always a good look. The aquisition of Civilbuild looks like its starting to bear fruit. The infrastructure boom in Australia should see SND do quite nicely over the next few years.
     
  9. So_Cynical

    So_Cynical The Contrarian Averager

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    1c per share FF interim dividend, same as last year so i think we can expect another 1 cent minimum next half thus dividend maintained, yield of 3.33% net again..
     
  10. peter2

    peter2

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    Thanks, the weekly chart is interesting and would be very attractive once price makes a new yearly high (>0.63). I like that there's been a few higher lows throughout 2017. The daily traded volume is very low, so it's only for longer term holders.
    snd2102.PNG
     
  11. galumay

    galumay learner

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    Well its been a rough couple of years for SND and the pain continues for shareholders this year! I have them in the bottom drawer and hopefully the turnaround story will play out over the next couple of years. One of my few dogs!
     
  12. Dona Ferentes

    Dona Ferentes

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    "Operational and organisational changes in the past 2 years". ....and a declining shareprice over that time, until recent earnings announcements. Up some 50% in the last month or so. But only back to where it was.
     
  13. galumay

    galumay learner

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    Just thinking about SND, and I have held for years, is that one of the advantages of buying businesses that have no debt and nice clean financials is that they can stumble along for a long time looking for ways to turn things around. SND is starting to show some signs that they might have finally turned the corner, and if they can return to profitability and even slow growth the lack of debt and simple business model means they should re rate.

    For those reasons I havent minded having it in my bottom drawer all this time.
     
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  14. So_Cynical

    So_Cynical The Contrarian Averager

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    2 good contract wins and all is forgiven, i too like clean simplistic financials, another big contract win could push them over a dollar.
     
  15. finicky

    finicky

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    Crap company since Benson the CEO/M.D arrived 12/08/2015. Not buying shares while he 's there. Used to be able to count on maybe 20% ROE for SND except GFC, now last two years a loss and no dividend. Under him SND acquired Civilbuild business in Apr 2017 which is lemon so far. Civilbuild loses money on contracts. Before him SND had a conservative static share issuance then with his ambitions a big equity raise to fund Civilbuild. Gets paid $667k fy19 including a cash bonus.
    Disc: held Sentiment: eventual sell
     
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  16. galumay

    galumay learner

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    Some fair points there finicky, I have held since well before Benson's arrival and the business has struggled in the mean time. I also haven't added and would need to see material change in the FCF & ROIIC before I did.
     
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  17. Dona Ferentes

    Dona Ferentes

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    A boutique manager Naos (NCC), with a market cap around $80 million and which holds only 9 stocks (conviction and value Bias) has been holding SND for years. The Evans boys get under the hood of the companies they invest in. The Monthlies etc often have a bit of detail; more can be garnered at the NCC Investor presentations

    from the July 2019 Monthly review
    and again in Oct 2019 Monthly review
    and at Nov 2019 AGM
     
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  18. finicky

    finicky

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    Yeah well, SND very lame investment I think. Hundreds better out there than this. In this space: $MND, $LYL.
    SND run at a loss last 2 years and below par 2 years b4 that. Lame M.D. Doesn't matter how much work they've got in hand if they haven't tendered properly to get it. A contract is supposed to have a margin and result in a profit. Seems like a case where personnel of an acquired business (Civilbuild) doesn't bother under the new regime.
     
  19. galumay

    galumay learner

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    I guess finicky it just goes to show the human condition - 2 people can look at the same thing and see entirely different realities! As I said, I dont disagree with some of your thoughts about the business, but you also have to consider what you might be missing when a fund like NAOS holds a significant position given how few businesses get thru their research and analysis process.

    I bought NWH down to 20c when everyone had written that business off, it had fallen from north of $1 where I first bought. Its now probably the very best of the mining services businesses and my 20c parcel that I still hold is up over 1000%.

    Not saying SND is the next NWH, but you have to buy them when no one else likes them to make those sort of returns! I have learnt to be very patient too, and thats easier with a business that has no debt.
     
  20. Dona Ferentes

    Dona Ferentes

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    Probably not looking at the same thing but looking at some same thing at a different time.

    I'm interested in making a few $$, and feel I could make it from SND if the cards fall the right way. That said I hold MND and have since forever, before the 4:1 split. It's a multibagger, paid about a buck. My invested dollars I get back as dividends, sometimes in a year and sometimes a bit less. So then it's hard to buy more, it's hard to sell MND but equally it's hard for MND to hit, say, $40. Whereas SND could well double. IMO.

    But do I want more exposure in the sector? Tricky.

    Glad to have tossed in a grain of sand that may help a pearl form.
     
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