MLD - MACA Limited

[ROE]

Suppose the problem is proving that they did it intentionally. And if they did, still doesn't explain how their profit is still so high up - unless they profited due to a ponzi as well. There are mining and construction stocks these days with horrendous FY14 performance but are making a steady recovery. Guess you can't take anything at face value.

Profit means little in the stock market (you can cook profit), learn to read the cash flow statement and most of your answers maybe lying there.

I dont have any holding in this business just general comments so I don't know their books but cash flow statement and free cash flow is a good figure to go by.

You can learn a bit from SGH saga where profit is growing at a healthy clip but have negative cash flow and once stuffed up and down comes the crash.

 

[joeno]

Profit means little in the stock market (you can cook profit), learn to read the cash flow statement and most of your answers maybe lying there.

I dont have any holding in this business just general comments so I don't know their books but cash flow statement and free cash flow is a good figure to go by.

Cash flow from Op activities (half year 2015) +64m which is stellar
CF from investing (loans and purchases) -38m
CF from financing (mainly due to dividends paid) -36m

Essentially if they didn't pay any dividends their cashflow would be amazing. Can't blame them for that can you?

I get it. Essentially they prevented any real growth due to paying out more dividends than what they get in their hands that year. Still, you would expect the price would halt or grow slowly as they're still making a lot of $.

 

[luutzu]

Cash flow from Op activities (half year 2015) +64m which is stellar
CF from investing (loans and purchases) -38m
CF from financing (mainly due to dividends paid) -36m

Essentially if they didn't pay any dividends their cashflow would be amazing. Can't blame them for that can you?

I get it. Essentially they prevented any real growth due to paying out more dividends than what they get in their hands that year. Still, you would expect the price would halt or grow slowly as they're still making a lot of $.

Gone up 6% today.

At some point you got to ignore the market and come to an estimate of what value you're happy with and why.

With all businesses, it's always the future earning that matter, not the historical. Since we can't predict the future, all we have are historical data and with a combination of that and understanding of the company's position and industry, may be able to guess where the future will go for the company.

In its presentation, MLD projected its revenue to halved by 2018 right? That's even including the potential revenue from mine expansion on its current projects.

Since that projection, a couple of projects are canned... with the low IO prices Atlas Iron project were canned but with a slight increase a couple months back and MLD agree to take some equity in the project I'm guessing, the project restarts... and with current low now, might be canned again.

So future prospects for MLD is shaky. Very hard to predict.

Who knows, it might win a contract or two in infrastructure and civil works... maybe commodity will pick up and projects resume. If that happen its share will sky rocket. If it does not, share price will hit the floor in next couple of years.


I think I said it before, but if you were to run this business and given the ending of civil works in a few months, the tough condition your clients are going to face... you wouldn't be paying out special dividends, wouldn't increase normal dividends... Not when your cash flow couldn't pay for the dividends at all, and not when you then have to go and raise more money from new investors.

You would, and I'm assuming mgt is smart enough and experienced enough to have some idea of the tough conditions the industry is about to go into... you would introduce DRP, reduce the divvy a bit - to keep both shareholders happy and get to keep some cash.

Then if you need to raise capital, raise it but probably better use of cash would be to acquire smaller peers or related operators so you can diversify your operations, maybe get a contract or two.


The focus by mgt seem to keep shareholders happy with high yield, to stall the stock price decline, raise more cash... and joint with client to help them through the tough time - enabling you to record revenue, hence record profit.. but can the sales be collected?

 

[peter2]

The chart of MLD is worth noting for this weeks break-out of a long term resistance level.

Its worth checking on the div yield (11.39%) it seems a little too good.

 

[peter2]

Well my last post was worth noting as price did BO and go back up to the prior high (+75%). Price has been in a range for the past year and once again looks likely to go higher. It won't as easy this time due to probable resistance at all the old highs between here and 2.00. Traders deal in probabilities and risk reward.

Note the On Balance Volume (OBV) indicator that is plotted on the volume pane. OBV was making a new high when price BO-HR (Apr16). This is a good confirmation filter. The OBV indicator has been rock solid during this sideways trading range indicating accumulation rather than distribution.

 

[helpme]

I have been deeply wounded by MLD this morning. It is one of my larger positions and it crashed >20% this morning. Anyone shares this same painful experience as me? I am going to hide in silence and contemplate over this loss for a while. This is not the first time mining-related stocks gap down huge on me without warning. I need to re-look at mining-related stocks. Anyone can share their experience?

Latest ASX announcement.
http://www.asx.com.au/asxpdf/20171113/pdf/43p56gfym5gs81.pdf
It does not read so bad to justify a >20% crash in the morning opening. Maca even states that it remains very positive on its future pipeline of work. Still, my 20% painful loss ...

 

[skyQuake]

I have been deeply wounded by MLD this morning. It is one of my larger positions and it crashed >20% this morning. Anyone shares this same painful experience as me? I am going to hide in silence and contemplate over this loss for a while. This is not the first time mining-related stocks gap down huge on me without warning. I need to re-look at mining-related stocks. Anyone can share their experience?

Latest ASX announcement.
http://www.asx.com.au/asxpdf/20171113/pdf/43p56gfym5gs81.pdf
It does not read so bad to justify a >20% crash in the morning opening. Maca even states that it remains very positive on its future pipeline of work. Still, my 20% painful loss ...

One trick pony - costs blowout could end it.

Meanwhile everyone else is having fat margins from a construction boom

___________________________________________________________

Best way to be hurt less from these kinds of things is position sizing

 

[greggles]

It looks like the bottom might be in for MACA Limited.

Today it terminated its mining services contract with Beadell Resources at Tucano in Brazil and agreed to a mutual deed of release from all claims by either party in relation to the Tucano open pit mining services contract. The two companies have also agreed to a payment plan regarding the payment of all outstanding amounts owed to MACA. The payments are $3M in Q3 2018, $3M in Q2 2019 and then $1.5M monthly from 1 July 2019.

Looks like a bit of confidence in MLD has finally returned.

 

[Dona Ferentes]

In a Trading Halt

Mining contractor Maca is putting the finishing touches on a capital raising to fund its purchase of Downer's Open Cut Mining West division for just under $200 million. ..... sources said the company had Euroz Hartleys Limited in its corner to help it stitch together the deal, which would see it raise $80 million-odd in fresh equity.

Downer told the market last week that it was in discussions with Maca to offload the business unit. Although it is selling Open Cut Mining West, Downer will still hold onto its Open Cut Mining East, Underground and Otraco mining services units.
The purchase is a chunky bite for the $311 million Maca, which posted $808 million revenue in fiscal 2020 and $120.4 million EBITDA. Maca's shares have performed strongly through the pandemic, and are trading up 12.6 per cent to $1.16 year-to-date.

 

[finicky]

MLD @ 0.79

No way I would be buying the chart yet but sellers aren't asking much going by historical earnings if you leave out fy20. Too unpredictable these mining contracts, MLD just announced will be losing a big one in March 2022 when the current agreement expires. GNG has been going well though.

Not Held

5 Yr Daily

 

[mullokintyre]

Report in Todays OZ that maccas is ripe for a takeover.

Maca is coming under focus as a takeover target, according to industry sources.
The mining services provider’s stock price is hovering around 84c after trading at more than $1 in 2019, with its market value at about $287m.

An attraction for a prospective suitor of Maca is that commodity prices are soaring and most in the market see the business as undervalued.
It only generates about 6 per cent of its revenue from the coalmining industry, which is out of favour with investors.

The majority of its revenue comes from other types of mining, where it generates 61 per cent, and 24 per cent civil construction, an area set for growth in the years ahead at a time when the government is set to increase spending on infrastructure construction.

The remainder is from infrastructure maintenance, crushing, international mining and its Maca Equip business.

I bought it a few weeks ago based on its high dividend yield.
Would be the worlds second greatest fluke if it came into play now.
Certainly been some interest on market over past few days,and up 9% today.
Mick

 

[divs4ever]

then i wish you luck ,

i am very wary on mining service companies now after being BADLY scorched with BLY , ( and not such a happy time on others ) i do have some ( like MIN and recently sold out of IGO . )

but Maca showing a pulse , and there is plenty of M&A activity

it would be interesting to see who lobs in a bid

 

[mullokintyre]

Fin year results out.
Makes nice reading.
revenue up 45%
EDIT up 51%
Cash sitting at 122mill versus 180 mill in debt.
Reduced debt by around 114 mill this year.
2.5 CPS dividend.
order book healthy.
Guidance for next year has revenue of 1.4 bill as against 1.17 for fin year just gone.
Will keep holding at that rate.
Mick

 

[mullokintyre]

then i wish you luck ,

i am very wary on mining service companies now after being BADLY scorched with BLY , ( and not such a happy time on others ) i do have some ( like MIN and recently sold out of IGO . )

but Maca showing a pulse , and there is plenty of M&A activity

it would be interesting to see who lobs in a bid

Well, I should have listened to you.
Ever since I bought in its been on a downward slope.
Has a had a succession of new 52 week lows including today at .67.
At least i got a dividend from it.
Mr Market obviously does not see a bid coming.
Mick

 

[mullokintyre]

Rumours about MLD's possible takeover just won't go away.
The latest is from Australian Business review

Speculation is mounting that the CIMIC-backed mining services provider Thiess is considering a buyout of its listed rival Maca.
Suggestions surfaced in July that a party was running the ruler over Maca, and at that time its share price was around 84c.

Its shares last traded at 76c with its market value now at $261m.
The latest talk is that Thiess is taking a look at the business with the view of an acquisition to reduce the proportion of earnings it gets from coal-related activities.

The thinking is that the idea is to pivot the business away from coal ahead of plans by its owners, CIMIC and Elliott Management, to sell the business at a later stage.

CIMIC had been looking for a buyer for Thiess for some time before the US-based fund Elliott Management agreed to take a 50 per cent interest in a deal that valued the company at $4.3bn and saw between $1.7bn and $1.9bn in proceeds delivered to CIMIC.
However, as part of the deal reached a year ago, Elliott has the right to sell its interest in Thiess back to CIMIC in between three and six years.

Thiess is the world’s largest mining services provider and considered the best in breed in the industry.

But in the past buyers have not been keen to pay up due to its coal exposure and the fact that services companies typically have low margins and are capital-intensive.

However, CIMIC’s European parent, the ACS-controlled Hochtief, has been keen to pay down debt and sources say it still has hopes of selling the business in its entirety.

I sold out about three weeks ago, thinking it was a lost cause, with a loss on my investment.
The deal may not go ahead of course, but speculation may have given me a chance to lose less money.
Such is life.
Mick

 

[peter2]

One benefit of getting out of a losing position is that now you can look at the current potential without too much emotion. If you're thinking about revenge then you've still too much emotional baggage. Forget MLD in this case. Find another better opportunity for your money.

 

[mullokintyre]

put the money into Ricegrowers.
Mick

 

[Miner]

https://wcsecure.weblink.com.au/pdf/MLD/02466189.pdf

PE - shocking.
Employee no interesting.

 

[signalFollower]

MLD hit my scanners during the week for "Turning Up"

new recent Highs looks alright

 

[mullokintyre]

Thiess lobbed a bid for Macas at a 28% premium to last closing price.
I had sold at a loss sometime ago, but that's life.
Mick