DCG - Decmil Group

[peter2]

reversal watch list? Are you backing out? Rear mirror investing?

Who me? Hardly ever, I keep a few watch lists and wait for my price patterns to form.

DCG will have to trade over 0.07 without going below 0.052 before I'm really interested. It sits in the watch list until it tells me to get set.

While I'm waiting, it's good enough for a monthly comp selection.

 

[peter2]

Every small cap portfolio has to have a few "dogs". This mangy canine has bitten me a couple of times but I'm hoping it'll finally see who been feeding it. I've posted enough about DCG's problems and I don't know if they'll continue. Management has been changed, bad projects written off with huge losses and a recent recapitalisation. This is one small cap position that I'll invest the minimum amount and use the 50% SL.

I'm thinking that the recent increased gov't spending in major infrastructure projects all round the country should help civil engineering companies like DCG. Are the management team capable of turning DCG around? W'ell see.

 

[Clansman]

I

Every small cap portfolio has to have a few "dogs". This mangy canine has bitten me a couple of times but I'm hoping it'll finally see who been feeding it. I've posted enough about DCG's problems and I don't know if they'll continue. Management has been changed, bad projects written off with huge losses and a recent recapitalisation. This is one small cap position that I'll invest the minimum amount and use the 50% SL.

I'm thinking that the recent increased gov't spending in major infrastructure projects all round the country should help civil engineering companies like DCG. Are the management team capable of turning DCG around? W'ell see.

View attachment 108257

It's less than a dog. It's a flea haven. Drive down the street. You can always get a park.
There is no turn around story here.

 

[peter2]

Were all experienced professionals here on ASF. We never get surprised by price movement. We plan our trade and execute our strategies without emotional attachment. So of course we're not excited by the recent BO-HR seen on the DCG price chart. I'm here calmly planning my next action (pyramiding) on DCG.

 

[peter2]

In order to cover past mistakes DCG is going to consolidate (10 to 1) the number of shares in early Nov. This makes them look better as insto's won't buy low priced bargain bin companies.

edit: Would be a certain winner in the Nov monthly comp as 0.06 turns into 0.60 in Nov.

 

[Austwide]

@peter2 just checked the rules, nothing covering consolidations, I think you may be the winner. LOL

 

[Miner]

In order to cover past mistakes DCG is going to consolidate (10 to 1) the number of shares in early Nov. This makes them look better as insto's won't buy low priced bargain bin companies.

edit: Would be a certain winner in the Nov monthly comp as 0.06 turns into 0.60 in Nov.

Good luck mate

 

[Bazzi]

DCG share price rose 818% today! Was on my watch list and missed it..... What happened here?!

 

[Austwide]

From @peter2 post a few above, this maybe DCG is going to consolidate (10 to 1) the number of shares in early Nov.

 

[Miner]

July tip for me DCG. Did not realize this thread was started by me back in 2009 when DCG just came into the market.
DNH.
I am hoping DCG will turn around in FY 22 with so many constructions works going on and with COVID restriction, probably miners are preferring DCG.
In addition, DCG is diversifying and the insiders have put some hefty money to buy.
extension of $40 M capital facility directs more works.
Very promising presentation https://cdn-api.markitdigital.com/a...access_token=83ff96335c2d45a094df02a206a39ff4
FY 22 guidance is robust too.https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02381666-6A1035629?access_token=83ff96335c2d45a094df02a206a39ff4
https://cdn-api.markitdigital.com/a...access_token=83ff96335c2d45a094df02a206a39ff4

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02359044-6A1026741?access_token=83ff96335c2d45a094df02a206a39ff4

 

[peter2]

DCG is one of my old dogs. Not surprised it hasn't been one of over 400 companies selected in the CY22 comp. They keep winning contracts and still in business. Why aren't investors showing more demand.

Maybe because they're all losing money, as the last cap raise was done at 0.40.

 

[divs4ever]

DCG is one of my old dogs. Not surprised it hasn't been one of over 400 companies selected in the CY22 comp. They keep winning contracts and still in business. Why aren't investors showing more demand.

Maybe because they're all losing money, as the last cap raise was done at 0.40.

View attachment 135149

i hold DCG ( and have for several years ) ( 7 buys between January 2014 @ $1.975 until December 2019 @ 48 cents and the next year it CONSOLIDATES ten into one and is NOW still well below the December 2019 price so an easy 90% down on THAT price )

i think Clansman calling it a 'flea-haven ' was much too generous , but maybe he is just a very diplomatic person

but heck @ 32.5 cents ( post-consolidation ) maybe they can consolidate again , to make it look like they are an investment-worthy company and not a short-sellers paradise

 

[divs4ever]

DECMIL GROWS ORDER BOOK TO $620M WITH
$137M OF NEW CONTRACT AWARDS AND
AFFIRMS FY22 EBITDA GUIDANCE
▪ Decmil wins three new contracts in Western Australia combined worth more than $100m
▪ The WA awards signify Decmil’s enhanced strategic progression into regional
infrastructure and selective construction markets which are higher margin market
segments of the broader construction sector
▪ Decmil also secures two new contracts in Victoria combined worth approximately $37m
▪ The Victorian awards highlight Decmil’s growing repeat revenue base with blue chip
clients
▪ Revenue and earnings from new contracts to be reflected in FY23 financial results
▪ FY22 EBITDA guidance retained, while FY22 revenue guidance revised, after Ryan Corner
and Crookwell wind farm project commencements delayed into FY23
Decmil Group Limited is pleased to announce it has secured five new contracts in Western Australia
and Victoria totalling approximately $137 million.
Decmil interim CEO Vin Vassallo said the contract awards marked an important step for the business
which increased its exposure to higher margin market segments and repeat revenue within its core
capabilities and geographic expertise.
“The South Hedland TAFE and Karratha Senior High School contracts follow our award earlier in the
year to construct the new Port Hedland Community Centre, which illustrates the increasingly strong
track record we are building in the construction of non-process infrastructure for the local Pilbara
community.” Mr Vassallo said.
“Our contract to deliver an apartment complex for highly-regarded property developer Stirling Capital
has followed a lengthy Early Contractor Involvement (ECI) relationship and provides a prudent and
strategic opportunity in the specialised luxury apartment construction market that also provides robust
margin opportunities while utilising the construction skills that Decmil possesses.”
“Additionally, our relationship with the Victorian Government is going from strength to strength and the
works we have secured in the state stem from our inclusion in contractor panels, which is conducive to
sustainable long-term growth.”
The award of these contracts takes Decmil’s order book to approximately $620 million at 31 May 2022
including contracted and preferred, with $218 million of new contracts won to date this calendar year.
Pundulmurra TAFE
The WA Department of Finance has awarded Decmil a $38 million contract to construct new training
workshops at the Pundulmurra TAFE campus in South Hedland.
The new training workshops encompass three new buildings; an industry-aligned heavy plant training
facility, an engineering trades training facility, and a new commercial cookery facility. The project will
commence later this month with the contract scheduled to be complete in the second half of 2023.
Florin Apartments
Decmil has secured a $37 million contract for the final design and construction of the Florin project in
the Perth suburb of Jolimont. The site is located within the Parkside Walk subdivision, a planned
residential community led by state government land agency DevelopmentWA, formerly Landcorp, in
partnership with the Town of Cambridge.
Florin comprises 63 luxury apartments over six levels and is being developed by Stirling Capital.
Decmil has been working closely with Stirling Capital under an Early Contractor Involvement (ECI)
phase over the past six (6) months.
Works on site will begin next month, with the contract scheduled for completion in second half of
2023.
Karratha Senior High School
Decmil has also won a $26 million contract from the WA Department of Finance to expand and upgrade
Karratha Senior High School. The works package includes the construction of a new building consisting
of workshops, classrooms, teacher’s study and support services.
Additionally, the Company will undertake extensions to the existing building in order to provide new
offices, meeting rooms, reprographics and student wellness rooms; as well as refurbishment and
extension of the existing metal workshop. Decmil has started initial site works and the contract is
scheduled to be completed in mid-2023.
Tranche 4 Structures Rehabilitation Package
Major Road Projects Victoria (MRPV) has awarded Decmil a $30 million contract for the Tranche 4
Structures Rehabilitation Package (North and South East).
The scope of works encompasses the renewal and maintenance of 11 bridge structures across
Melbourne’s North and South East, which will see critical infrastructure meet the growing needs of the
Melbourne road network, as well as extend the life span of current bridge assets for years to come.
This contract was previously preferred and having worked closely with MRPV over the past four months
has been now contracted. Work on site will commence immediately and expected completion of the
works is scheduled for the end of 2022.
This is the second project Decmil has been awarded as part of MRPV’s new Program Delivery
Approach, which has a strong focus on collaborative, panel-based procurement during the tender phase
leading to fixed price agreements to deliver works. In September 2021, Decmil secured an $89 million
contract with Major Road Projects Victoria to upgrade Barwon Heads Road in Victoria, with the works
on track to be complete in 2023.
Construction of Crossings in the Snowy District
Decmil has won a contract from the Department of Environment, Land, Water & Planning in Victoria for
the design and construction of 10 crossings in the Snowy District.
This work will assist in providing safe and efficient access and egress to large tracts of public land to
enhance supporting fire management activities, including the movement of critical heavy firefighting
equipment whilst also improving public access. Works on this contract will start immediately with an
estimated completion by the end of April 2023. The current contract value is $6.5 million.
Updated Market Guidance
Further to the ASX announcement on 8 April 2022, projects at Ryan Corner and Crookwell have had
further delays due to the Client delays in gaining project permitting and approvals. These delays are
not attributable to Decmil. As a result, revenue in FY22 is now expected to be in the range of $400m to
$425m. However, Decmil reiterates its FY22 EBITDA guidance of between $-15m and -$10m.
Additionally, the vast majority of the revenue and earnings from the three contracts announced today
will be reflected in Decmil’s FY23 financial results.
This ASX release was authorised by the Decmil Group Limited Board.

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i hold DCG

this is down 87% for me , maybe it will recover , but am not holding my breath

 

[divs4ever]

DECMIL UPDATES FY22 GUIDANCE
▪ Revised financial guidance (unaudited)
- Positive FY22 cashflow from operations of +$6 million
- Decmil’s first positive net operating cash flow since FY19
- FY22 net loss of $49 million before intangible asset write-downs
- Intangible asset write-down of $53 million (goodwill and deferred tax assets)
▪ Robust cash position of $39 million (30 June 2022) giving zero net debt
▪ Robust contracted order book of $596m (31 Dec 2021: $520m), with $472m to be executed in
FY23
▪ Ryan Corner windfarm mobilisation commenced following receipt of approvals and
agreement on revised commercial terms
Decmil Group Limited provides the following operational and financial update to its shareholders
following a comprehensive review undertaken by the Board and new management of current projects,
Decmil’s contracting terms, and legacy balance sheet valuations.
Operating conditions have stabilised since Decmil’s April 2022 market update and guidance revision,
with contracts having been renegotiated and the Company adopting a revised approach to contract
tendering. However, the Board has decided to reset the values of several balance sheet items, many
on legacy items, to reflect current values and the likelihood of being able to crystalise or utilise the value
of those assets.
Decmil CEO Rod Heale said the statutory accounting result, while significant and disappointing,
addressed many of the Company’s legacy issues, and the Company’s growing order book and robust
cash balance positioned Decmil for a substantial improvement in FY23.
“While the net loss is large, it reflects a very difficult period for Decmil through the COVID pandemic. I
am however confident our improved cash flow and robust cash position will provide a solid foundation
for FY23,” Mr Heale said.
“The Board and management have taken a cautious and prudent assessment of various asset values
and contract positions. After going through the process, I am confident the Company is starting the new
financial year with a very strong order book and a cash and liquidity position that enables the company
to execute that order book.
“We are heading into FY23 with a selective and low-risk approach to tendering new work, ensuring we
can maintain our strengthening margins and cost efficiencies in the current environment.”

Decmil has reviewed its contract claim balances, which contain reliance on claims against certain clients
and subcontractors. After assessing each claim individually, Decmil has decided to adjust the balance
of claims for the financial year ended 30 June 2022 by revising their value down by $23 million, which
accounts for the variance to revenue and EBITDA guidance. Any eventual success of the claims will
result in cash inflows to Decmil.
Additionally, in preparing its FY22 financial accounts, Decmil has reviewed certain intangible assets on
its balance sheet (deferred tax assets and goodwill).
The goodwill balance of Decmil’s intangible assets no longer reflects Decmil’s current market
capitalisation. While the Board’s strong view is that the company is highly undervalued, the Board has
considered it prudent to impair the goodwill balance by $30 million, from $75 million to $45 million.
Over the past seven years, Decmil has incurred significant tax losses and now carries a tax loss carryforward balance of approximately $190 million, inclusive of an FY22 estimate. In light of this substantial
bank of available tax losses, Decmil will derecognise its deferred tax assets of $23 million to zero at 30
June 2022.
The decision to write down the value of these intangible assets (non-cash) and the balance of contract
claims will cause a significant accounting loss for Decmil in FY22 of $102 million.
30 June 2022 Cash/Debt Position
Pleasingly, the Company generated a substantial improvement in net operating cash flow over FY22,
with a net operating cash inflow of $12 million for H2 FY22, compared to a net operating cash outflow
of $6 million for H1 FY22. The Company is confident it can continue this positive cash flow generation
during FY23. The 30 June 2022 cash balance was some $39 million with debt of some $39 million
leaving a net debt position of $0. This is an improvement from 30 June 2021 where the net debt position
was $8 million.
The non-cash, intangible asset value write-downs above are not expected to impact Decmil’s current
financial accreditations that underpin the Company’s ability to win new work in FY23 and beyond.

Strong Order Book
As at 30 June 2022, Decmil’s contracted work in hand is $596 million. Approximately $472 million of
this contracted work relates to revenue expected to be delivered in FY23. Decmil’s focus in the next 12
months is to efficiently deliver this work for clients to the highest standards and generate tendered
margins. Decmil has capacity to secure additional projects, but intends to take a highly-selective
approach to new contracts over the next 12 months.
Management has renegotiated several contracts since March 2022 and certain contracts have been
reset to account for the impacts of COVID-related supply chain delays and price escalation. As a result
of those negotiations, the level of the contracted work in hand and contracted margin of that work has
improved.
Ryan Corner
Decmil is pleased to provide an update on the Ryan Corner project. After several delays in the
commencement of the project, largely as a result of project permitting and approvals the Client was
required to obtain, Decmil has commenced works on site and has reached an agreement regarding
revised commercial terms to account for the delays to the Company. Decmil announced the award of
the Ryan Corner contract on 18 November 2020.
This ASX release was authorised by the Decmil Group Limited Board.

=======================================================================================================

DYOR

i hold DCG

has been a mangy flea-bag for me

not as bad as BLY but you could just about walk between ( without needing a cut lunch )

 

[Dona Ferentes]

BOARD UNANIMOUSLY RECOMMENDS MACMAHON’S OFFER

Macmahon to offer to acquire all ordinary shares in Decmil for $0.30 per ordinary share via a scheme of arrangement
- Offer provides Decmil shareholders with premium of 76.5% to most recent closing price and 81.8% to the 30-day VWAP of Decmil shares
- Premium, cash offer provides Decmil shareholders with enhanced certainty and accelerated value
- Decmil redeemable convertible preference shareholders to be offered an aggregate of $0.343 per Decmil RCPS via a separate, contemporaneous scheme of arrangement
-Decmil board unanimously recommends that Decmil securityholders vote in favour of the Schemes
- Directors and shareholders representing a combined 27.8% of Decmil’s shares on issue and 40.1% of Decmil RCPS on issue, have indicated an intention to vote in favour of the transaction
- Subject to the approval of the Scheme Participants and all other conditions of the Schemes being satisfied, the Schemes are expected to be implemented by the end of August 2024

 

[divs4ever]

yes , i did think about buying some MAH on the market reaction , but have resisted so far

 

[System]

On August 16th, 2024, Decmil Group Limited (DCG) was removed from the ASX's Official List in accordance with Listing Rule 17.11, following implementation of the scheme of arrangement between DCG and its shareholders in connection with the acquisition of all the issued capital in DCG by Macmahon Holdings Limited.