Maca Limited
Mixed Performance: Maca Limited (ASX: MLD) is a well-diversified company with the principle activity of loading and hauling, crushing and screening, drilling and blasting, material handling, and other open pit contracting services. Recently, the group provided an update on recent project awards exceeding $60 Mn within the company’s Civil, Infrastructure and SMP business units (BU). These recent contract wins, and variations will support to raise its Work in Hand (WIH) position to $143 Mn in FY19 and overall WIH to $1,051 Mn. As per the release, the following contract in Civil business includes $12 Mn variations to the bulk earthworks contract with the Gruyere Joint Venture, which extends to October 2018. Further, the group anticipates generating revenues of around $5 Mn to $6 Mn in FY19 at its Cosmos Nickel Project via Civil Earthworks Contract. Besides this, the company through its subsidiary MACA Interquiphas been awarded a $6 Mn contract for an intersection upgrade for VicRoads with the bulk of the revenue expected to be generated in the second half of the 2018 calendar year.
On the financial front, the company delivered revenue of $285 Mn for 1HFY18, marking the solid growth of 18 per cent as compared to the prior corresponding period (pcp). However, NPAT de-grew by 28 per cent and amounted to $ 12 Mn in 1HFY18 on pcp basis. It was mainly impacted by operational losses within the MACA Interquip segment and Victorian Civil contracts as disclosed via the ASX market update on 13 November 2017. The overall impact to the group's statutory NPAT result attributable to members was $3.8 Mn. Resultantly, RoE substantially decreased from 6.4% to 4.0% in 1HFY18. Besides this, Current ratio and Quick ratio stood at 3.65x and 3.51x in 1HFY18. As of now, the group focuses on stabilizing the earnings and return to growth in the mining sector in Western Australia.
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1HFY18 Financial Highlights (Source: Company Reports)
Commonwealth Bank of Australia and its related bodies, a substantial holder of the group upwardly revised its holding from 5.14% of interest to 6.21% of the voting power. Given the backdrop of a mixed scenario, we believe it will better to wait and watch this stock that trades at the current price of $1.240 as on July 23, 2018 (up 7.8% after falling about 33% in last six months).
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