# SDI - SDI Limited



## JeSSica WaBBit (31 January 2008)

Hi ASFers,

I wanted to begin a thread on SDI - Southern Dental Industires to discuss this stock and get your opinions.

I do not hold any stock in this company but i have it on my watch list.

Its been a real dog of a share over the past four years and its share price has dropped from about $2.20 to 26 cents where it languishes today.

I understand the decrease in share price is due to delays bringing to market a new product it has dveloped called 'Riva'. Its a tooth filling material made from sand/glass.

I also understand that the company will not see profits from this product impact on the bottom line for some time to come, possibly 2-3 years.

I reckon its one of those shares that might be able to be picked up very cheap in the next 12-18 months and could potentially provide great returns 3 years down the track.

I like these long term plays and have done well on similar before.

Anyone have any comments to make?

 JW


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## resbequoi (18 April 2008)

*Re: SDI - Southern Dental Industries*

Hi Jessica,
Well its been a long long time that I've held onto my sdi shares, I bought in at $1.80!!  Sheer stubbornness has me holding on, and I'm a long termer too.
I have been 'cheered up' by the fact that after the faulty battery issue that dropped the share price initially, the continued downward trend is due to the strengthening dollar and the increasing expense of materials.  Also that it is family run company with the family owning most of the shares, so out of sheer need to survive they are committed to turning the company sp around.  
Maybe I am wrong and stupid, but it's for those reasons that i still continue to hold and support this embattled company.  
I have been through some lows with this - see my post on dud shares!
But I still havent sold.

good luck to me i suppose


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## JeSSica WaBBit (19 April 2008)

*Re: SDI - Southern Dental Industries*

Hi Resbequoi,

I am still watching this company and if i can free up some money i will be looking to buy a few at or below 25cents to get things rolling. Depnding on how they go i will look to accumulate, but at present i am invested elsewhere.

Its been a real dog but thats when i like to buy them, when no body elses wants them or is remotely interested. I am happy to buy and hold, if i was to buy at 25cents i would be hopeful of an exit around $1.00 and looking to hold for 12 months to 5 years if necessary. Not a bad return for sitting on your hands...................

I just have a feelng they will turn things around but, who knows what will happen.

Good luck with it, if i take a position i will post on here, meanwhile i will be keeping a close on on it.

JW


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## tm220 (15 July 2008)

*Re: SDI - Southern Dental Industries*

hi guys,
just adding to this thread. I've had this stock on watch for a little while now and am wondering if anyone thinks now may be a good time to get in. I know this co. is adversly effected by exchange rates (due to the bulk of income being derived o/s) however I think with the negative markets worldwide the aussie cant stay as strong as it is for longer than another 12 months. 
may be one to sit on for some time but from what I understand the business is strong. 
any thoughts?

tm


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## JeSSica WaBBit (24 July 2008)

*Re: SDI - Southern Dental Industries*

Hey TM220,

i am still watching it, but, surely it must be near bottom now. I hear the company is relatively good, i have a contact.

I do not hold but i think if you are willing to sit on them for a few years they could be a good thing.

But DYOR, good luck with it.


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## Country Lad (12 July 2013)

Trembling Hand said:


> Silver aint looking too good....







Country Lad said:


> Unless you have SDI shares.
> 
> Cheers
> Country Lad




Anybody note the hint?

Cheers
Country Lad


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## shouldaindex (18 April 2015)

Just a bump for 2015.

Doing some research and noticed SDI has had a bumpy journey.

At the same time it's revenue has steadily increased year on year, so variations on cost/margin seem to have been the issue in the past.

Reached company high profit and revenue last FY, and seems to have some growth factors to the business.

The main issue for me would be unpredictability of earnings, given it's an industry which I'm not familiar with, otherwise it has a lot of the fundamentals I look for.

Any opinions welcome.


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## levin123 (23 November 2016)

It looks like the market misinterpreted this announcement? 

The announcement reaffirms FY17 guidance, but states that 6 month results to December will be between $2-2.5m, compared with $3m last FY. But due to historically strong 2H's the company remains confident of hitting targets.

However the price has tanked 33% on close.

From the update: _There has traditionally been a skew in earnings favouring the 2nd half of the financial year, due to seasonality in the regions that the Company operates in. This year SDI expects an even greater skew because of the impact of currency. The Company expects net profit after tax to be in the range of $2-$2.5 m compared with $3m for the first half of financial year 2016._

Has the market taken that $2-2.5m figure to be full FY17 forecast? A quick careless glance over could construe this due to the way it's worded. 

Or has the price just been trading at a large multiple due to expected growth, and now that guidance is wobbling, the market is reacting accordingly? 

Considering taking a punt.


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## McLovin (23 November 2016)

I'm not really getting how a currency move can be considered seasonal, unless they are in the business of currency forecasting.


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## galumay (23 November 2016)

levin123 said:


> Considering taking a punt.




Classic misspricing by Mr Market, all this info was in the public realm already - and people still try to argue in support of the Efficient Market Theory!

I missed the news until I got home just after the close of the market, so my order will have to wait until first thing tomorrow, hopefully it will go thru and I can double my holding with a nice average down!


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## Klogg (23 November 2016)

McLovin said:


> I'm not really getting how a currency move can be considered seasonal, unless they are in the business of currency forecasting.




The 1st half is generally weaker. I don't think they're blaming currency for the seasonality.

More importantly, even after adjusting for currency, the top line is OK. Problem sits within the expense lines.

Also worth nothing SDI have a horrible track record of reporting things properly to shareholders. FY15 NPBT/NPAT forecasts show this. Since recruiting MarketEye they've done a little better, but they really didn't address the reason for the profit drop here.


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## McLovin (23 November 2016)

Klogg said:


> The 1st half is generally weaker. I don't think they're blaming currency for the seasonality.
> 
> More importantly, even after adjusting for currency, the top line is OK. Problem sits within the expense lines.
> 
> Also worth nothing SDI have a horrible track record of reporting things properly to shareholders. FY15 NPBT/NPAT forecasts show this. Since recruiting MarketEye they've done a little better, but they really didn't address the reason for the profit drop here.




The way I read it, they're blaming ccy for exacerbating seasonality, but maintaining FY forecast. If that's the case then won't the ccy have to bounce back in 2H?

I had them for a few years never really felt comfy with them and got impatient so flicked them. Of course then up they went.


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## McLovin (23 November 2016)

McLovin said:


> I had them for a few years never really felt comfy with them and got impatient so flicked them. Of course then up they went.




...And they're back within 10c of where I sold. I'll have another look at them.


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## Tightwad (23 November 2016)

i've only had a brief look but haven't found any previous half year numbers.   assuming 2-2.5 for a half, ideally you'd want maybe 5 for the second to beat last year, not sure if it's doable to have double in the second half.


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## Klogg (24 November 2016)

McLovin said:


> The way I read it, they're blaming ccy for exacerbating seasonality, but maintaining FY forecast. If that's the case then won't the ccy have to bounce back in 2H?
> 
> I had them for a few years never really felt comfy with them and got impatient so flicked them. Of course then up they went.




I only feel comfortable with them because it's essentially a family business. The downside is they pay themselves very hefty salaries, but it does mean interests are aligned.
I took bought at about 55c late last year and this quickly grew to become my largest position at $1.07. Not anymore, haha.

Their wording is poor, so not really sure what they're trying to blame. But if you look at their figures:
- Overall sales increase in AUD terms expected to be 3%
- Overall sales increase in local currencies expected to be 9%

Doing the math, I get a 5.5% currency movement. However, there's not enough operational leverage at play for a 5% movement in top line to impact 20-30% on NPAT - something else is going on.

Given the AGM is tomorrow, why didn't they just wait 2 days??


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## galumay (17 January 2018)

DOH! Missed an opportunity to average down even further, while I was carefully doing my analysis of the impact of the recent announcement, and deciding whether to pick up some more now or wait until the next results, they bounced up 15% this morning.

At mid 40c I thought they were pretty compelling, my range of valuation is significantly higher even allowing for a likely 20% hit on earnings this year. 

Sometimes thats the cost of being a patient and slow thinker - by the time I have got to a high conviction decision the horse has bolted!


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## greggles (21 August 2018)

Nice gap up for SDI Limited today following the release of their FY18 financial results.






SDI finished the day up 16% to 58c and is currently sitting just below resistance at 60c. With SDI predicting continued growth in sales of non-amalgam products we may see further short term share price gains.


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## galumay (21 August 2018)

A little surprising it jumped so much, it was pretty much steady as she goes and all to script. I guess it had been pretty heavily oversold on any reasonable valuation so some reversion was inevitable. I will probably grow to regret not averaging down more when the opportunity was obvious!


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## galumay (28 August 2019)

Its been a long and patient ride to see this play out, the conviction came from the financial strength, low debt, niche market, founders with skin in the game etc.


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## galumay (14 February 2020)

Solid HY report today, again I havent looked at it in detail but a cursory glance suggests its largely positive.


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## Huskar (27 April 2020)

I hold a little of this one and think it is a good business, as they accelerate revenues out of amalgam and into aesthetics which is now 45% of revenue.

However, they have just announced their business has been impacted with closure of many dental studios. This means NPAT likely $3.5-4.5m vs $7.3m last year. But at $83m market cap and little debt, I think its likely to weather the crisis ok. 

In the short-term, may well retest 50c lows though, which would make it very compelling buy because likely a snap back in dental restocking once studios do reopen. 

Also, the low AUD is now a strong tailwind for the Aussie-based manufacturer.


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## galumay (13 November 2020)

Nice update at the AGM, SDI doing well considering the impact of Covid. Rewarded with a nice little pop in the SP on an otherwise pretty red day.


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## galumay (6 May 2021)

Solid announcement from $SDI, guiding for up to 100% increase in NPAT for FY21 from FY20


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## galumay (20 August 2021)

SDI exceeded guidance, hitting 110% increase in NPAT, report looks strong on first pass, I like that they also compared metrics to last normalised year (2019), businesses with significant financial impact in 2020 should do this more often.


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## divs4ever (20 August 2021)

another 'bottom drawer ' stock  for me 

 i bought in @ 45c in January 2018  , so while not doing double back-flips  ,  it does raise a smile  

 now if all these silly disruptions cease ( probably  the 12th of NEVER )  ...


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## galumay (20 August 2021)

I have been in them since 2016, my average cost is a bit higher than yours, but also happy to hold with a smile!


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## galumay (2 March 2022)

H1 2022, SDI showing the same results as many businesses we hold, increased revenue, big decrease in earnings, negative cash flows, all blamed on a combination of covid, supply restraints and labour inflation. I think its going to be a year or more before we see if there were actually structural issues with some of these businesses, or if they bounce back and recover.


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## Dona Ferentes (2 March 2022)

galumay said:


> H1 2022, SDI showing the same results as many businesses we hold, increased revenue, big decrease in earnings, negative cash flows, all blamed on a combination of covid, supply restraints and labour inflation. I think its going to be a year or more before we see if there were actually structural issues with some of these businesses, or if they bounce back and recover.
> 
> View attachment 138442



Identical paste of revenue and earnings to EGN  !??!


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## divs4ever (2 March 2022)

ASX and Media Release 17 February 2022

Half Year Results Announcement for 1H 2022 SDI Limited delivers record first half sales with bottom line impacted by significant freight costs
MELBOURNE, Australia – SDI Limited (ASX: SDI).
 Net profit after tax of $2.7 million for the six months ending 31 December 2021, compared with $4.6 million for the same period last year. SUMMARY FINANCIALS (AUD) 1H 2022 1H 2021 Change % Sales ($m) 46.3 36.8 26.0
EBITDA ($m) 6.0 8.7 (30.3) NPAT ($m) 2.7 4.6 (41.2) Net Cash ($m) 6.5 11.1 (41.0)
Earnings Per Share (cents) 2.26 3.85 (41.3)
Interim ordinary dividend (cents) 1.50 1.50 unchanged

1H 2022 Highlights

• Record total sales of $46.3 million up 26.0% on pcp, with strong growth in all product categories and in most regions.
• Freight costs were up $2.7 million impacting product margins by 5.8% and Operating expenses up 12.6% on pcp, or up 2.5% compared to the 1H 2020 half year.
• EBITDA was down 30.3% to $6.0 million, compared to $8.7 million for the corresponding period last year, reflecting the elevated freight costs and incurred in the period
• Earnings per share (‘EPS’) was down 1.59 cents to 2.26 cents compared to 3.85 cents for the same period last year.
• Strong cash and no debt with Investment on research and development continuing.
• The strategic restructure of the Brazilian operations and fully operational in January 2022.
• Interim fully franked ordinary dividend maintained at 1.50 cents per share.

 but yes i agree  i am not expecting the famed V-shaped recovery  here  , the plus side is SDI are living within their means  ALTHOUGH if the harsh times linger  , and freight costs can be persistent  , so half-expect the future divs to be under pressure


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## galumay (2 March 2022)

Dona Ferentes said:


> Identical paste of revenue and earnings to EGN  !??!



Whoops!! TOO many reports open today.


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## divs4ever (21 June 2022)

Trading Update with record sales expected for FY22
MELBOURNE, Australia - SDI Limited (ASX: SDI), a leading dental technology company that
conducts research and development, manufacturing, and distribution of specialty dental
materials, today announced that sales for the twelve months ending 30 June 2022 are
estimated to increase 16% to approximately $95.0 million, compared to the prior
corresponding period of $81.6 million (FY21).
The company estimates that after tax-profit, for the twelve months ending 30 June 2022, will
be within the range of $7.0 million to $7.5 million, a decrease of 16% to 22% compared to
financial year 2021 of $8.9 million.
Commenting on the trading update Chief Executive Officer Samantha Cheetham said:
“We are thrilled to announce that FY22 will be a record sales year for SDI, with an estimated
$95 million of sales for the year. The strong growth momentum we achieved in the 1H22
continued throughout the 2H22, with all product areas growing strongly across all regions.
“Freight costs remain an ongoing headwind for the group, as with many other companies,
impacting the bottom line with an expected net profit of $7.0-$7.5 million for FY22. Despite
this, we remain committed to our strategy of prioritising customer service and, whilst we have
incurred additional freight costs to ensure supply, we are confident that our strategy has led to
increased market share underpinning this record sales result, and best positions SDI for future
growth.”
The FY22 result is due to be released on Friday 26 August 2022.
This announcement has been approved for release by the Board of Directors.

-------------------------------------------------------------------------------------------------------------------------------------------

( DYOR )

i hold SDI


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## JohnDe (21 June 2022)

Dividends are decent, but share price is a plodder.


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## divs4ever (21 June 2022)

bought mine in January 2018 @ 45 cents 


DIVIDEND TYPEDIVIDEND AMOUNT ($)FRANKEDEX-DIV DATEPAY DATE*Interim*0.015100.00%07/04/202222/04/2022*Final*0.017100.00%03/09/202120/09/2021*Interim*0.015100.00%08/04/202123/04/2021*Final*0.005100.00%04/09/202021/09/2020*Interim*0.014100.00%02/04/202017/04/2020*Final*0.015100.00%05/09/201920/09/2019*Interim*0.022100.00%28/03/201912/04/2019*Final*0.014100.00%06/09/201821/09/2018*Interim*0.011100.00%22/03/201806/04/2018*Final*0.013100.00%07/09/201722/09/2017*Interim*0.010100.00%23/03/201707/04/2017

 one of my few healthcare plays 

 a tough sector to find value AND returns


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## JohnDe (21 June 2022)

divs4ever said:


> bought mine in January 2018 @ 45 cents
> 
> 
> DIVIDEND TYPEDIVIDEND AMOUNT ($)FRANKEDEX-DIV DATEPAY DATE*Interim*0.015100.00%07/04/202222/04/2022*Final*0.017100.00%03/09/202120/09/2021*Interim*0.015100.00%08/04/202123/04/2021*Final*0.005100.00%04/09/202021/09/2020*Interim*0.014100.00%02/04/202017/04/2020*Final*0.015100.00%05/09/201920/09/2019*Interim*0.022100.00%28/03/201912/04/2019*Final*0.014100.00%06/09/201821/09/2018*Interim*0.011100.00%22/03/201806/04/2018*Final*0.013100.00%07/09/201722/09/2017*Interim*0.010100.00%23/03/201707/04/2017
> ...




$0.35 increase over 4 years. I also hold at a profit, I like the company but still a plodder.


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## divs4ever (21 June 2022)

yeah but i like SOME plodders   ,   to just throw out fairly regular divs 

 evens out the volatile stocks ( and their patchy divs )


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## JohnDe (21 June 2022)

divs4ever said:


> yeah but i like SOME plodders   ,   to just throw out fairly regular divs
> 
> evens out the volatile stocks ( and their patchy divs )



You should have a look at DDR. Great dividends, and the company is growing strong.


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## divs4ever (21 June 2022)

JohnDe said:


> You should have a look at DDR. Great dividends, and the company is growing strong.



 always seem to look at it the wrong time ( when the numbers don't crunch attractively  )    the last time i went stalking  with intent  i ended up buying RFF instead ( i was chasing 3 monthly div. payers at the time )

 however there should be further in this downturn maybe this time 

cheers


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## galumay (29 August 2022)

SDI FY 2022 results out and my commentary for the first half is basically my thoughts on the full year! 



galumay said:


> H1 2022, SDI showing the same results as many businesses we hold, increased revenue, big decrease in earnings, negative cash flows, all blamed on a combination of covid, supply restraints and labour inflation. I think its going to be a year or more before we see if there were actually structural issues with some of these businesses, or if they bounce back and recover.





Interesting that although they increased the divvy this year its still only just over 50% payout ratio.


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## JohnDe (1 September 2022)

New purchase -



> Purchase of new 6-acre site to support long term strategic planning
> 
> MELBOURNE, Australia - SDI Limited (ASX: SDI), a leading dental technology company that conducts research and development, manufacturing, and distribution of specialty dental  materials, is pleased to announce the purchase of a 6-acre site to support the long-term
> strategic plan for the Group and in the short-term adding important warehouse capacity.
> ...


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