Lindsay Australia Limited
LAU Details
Increase in bottom line: Lindsay Australia Limited (ASX: LAU) delivered an 8.0% growth in revenue during fiscal year of 2016 (without fuel revenue) driven by the customer volumes. The group’s Net profit after tax (NPAT) surged 30.9% to $8,072,000 during fiscal year of 2016 against the prior corresponding period. On the other hand, this increase in bottom line is mainly due to the one-time positive item from the recovery of earlier years’ costs related with settlement of a legal case ($735,000 after tax). Fuel revenue fell $8.9 million during the period due to lower wholesale price of oil. Moreover, the rate of depreciation and amortization is also rising.
Profit margins (Source: Company Reports)
Even Rural segment’s before tax profit reached $3,544,000, which fell by 5.5%, on the back of rising operating cost as the division expanded into new regions. Profit margins fell to 3.5% during the year from 3.9% in fiscal year of 2015. LAU stock fell over 10.3% in the last four weeks (as at October 13, 2016) and we believe the pressure to continue in the coming months. The group will hold its AGM on October 28, 2016. Accordingly, we give an “Expensive” recommendation on the stock at the current price of $0.43
LAU Daily Chart (Source: Thomson Reuters)
LandMark White Limited
LMW Details
Strong full year results: The shares of LandMark White Limited (ASX: LMW) has appointed Enrizen Capital as advisors for an expansion and acquisition strategy. LMW surged over 12.7% in the last three months (as of October 13, 2016) driven by their strong fiscal year of 2016 results. The group’s gross revenues including franchised offices enhanced 14.2% to $28.2 million during the year while revenues excluding franchised offices surged 15.8% to $22.8 million. Net Profit after Tax surged 113% year on year (yoy) to $1.7 million. LMW reported ongoing growth in clients and customer base. LMW paid a fully franked final dividend of 3.25 cents for the year which rose from 2.5 cents in the same period of last year. However, LMW stock has been correcting over 10.3% in the last four weeks due to concerns related to the Australia property market. We believe that the stock is “Expensive” at the current price of $ 0.62
LMW Daily Chart (Source: Thomson Reuters)
Schaffer Corporation Limited
SFC Details
Weak underlying profit: Schaffer Corporation Limited (ASX: SFC) plans to hold its AGM in November 2016 and reported an overall revenue rise of 36% yoy to $213.6 million for fiscal year of 2016, mainly driven by 53% rise in revenue from Automotive Leather. NPAT rose 61% yoy to $ 5.7 million during the period, as the group generated over $4.2 million of profit after tax from the sale of property.
Weak underlying profit (Source: Company Reports)
On the other hand, the group’s underlying profit fell over 11% yoy to $3.1 million during the year. The group also incurred higher CAPEX as they are developing new facilities in Slovakia. We give an “Expensive” recommendation on the stock at the current price of $ 5.21
SFC Daily Chart (Source: Thomson Reuters)
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