Programmed Maintenance Services Ltd

PRG Details
Continual marine business pressure: Programmed Maintenance Services Ltd (ASX: PRG) stock fell over 27.14% in the last three months (as of November 16, 2016) impacted by the concerns over the group’s marine business. On the other hand, the stock is up 10% on November 17, 2016 at the back of positive market sentiments. The group reported that they would witness weakness in earnings for the year to 31 March 2017 as compared to their earlier guidance. FY17 EBITDA is forecasted over $100m (previous guidance $120m), without one off Skilled integration and restructuring costs. Further $7 million of marine redundancies costs have been incurred to downsize the marine business, leading to one?off skilled integration and restructuring costs of $17 million projected in FY17 as compared to the earlier guidance of $10 million. On the other hand, the group has been trying to offset this pressure through its Staffing business but recently reported that the revenue growth in Staffing business will not offset the steep decline in marine business. Programmed Skilled Workforce (PSW) performance was on track, wherein the on?hire headcount fell only 1.4% even though WA, QLD and NT were facing huge pressure. The PSW on?hire headcount declined 6.7% in July and August against June, impacted by declining demand across several customers in all major states. The group’s Property Services business is on track with ongoing sales pipeline across its traditional education, aged care, retail and commercial customers. The Facility Management business has work?in?hand of $2,200m and a pipeline of further opportunities under active development. PRG stock is having a decent dividend yield and we give a “Speculative Buy” recommendation on the stock at the current price of – $ 1.59

 
PRG Daily Chart (Source: Thomson Reuters) 

Villa World Ltd

VLW Details
Lots enhancement: Villa World Ltd (ASX: VLW) stock fell over 13.6% in the last three months (as of November 16, 2016) while the group reported that a confidential Deed of Settlement for resolution of the Silverstone proceedings has been entered into, and the Court had approved the settlement. On the other hand, the group reported a decent bottom line wherein the statutory after tax profit rose 32% year on year (yoy) to $33.7 million. VLW reported overall full year dividends of 18 cents per share, representing a yield of 7.5% fully franked. The group’s lots enhanced to 5,937 lots, as compared to 5,191 in the same period of last year. VLW delivered 47% more product in fiscal year of 2016 as compared to four-year average. The group contracts reached 1,185 as of June 2016, against 843 in FY15. VLW has $165.6 million in carried forward sales and forecasts to maintain their sales growth and profit momentum in FY17. We give a “Hold” recommendation on the stock at the current price of – $ 2.20

 
VLW Daily Chart (Source: Thomson Reuters)

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