Australian (ASX) Stock Market Forum

SSM - Service Stream

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Interesting market update today. Retail and insto investors have been a bit more vocal lately and want to know what's happening with SSM.
A very noncommittal update that basically said wait for the annual report released Aug 28. Seems like there may be some minor disappointing news in that report.

The price chart indicates that the bottom may be in. Worth a speculative buy.

ssm1407.PNG
 
I would be very wary of anyone with significant contracts with NBN, the terms of the new contracts are so much lower than the existing, already low margin contracts. It has 2 impacts, firstly obviously margin squeeze, but also sub-contractors are exiting as the new rates for them are not sustainable.
 
galumay said:
I would be very wary of anyone with significant contracts with NBN, the terms of the new contracts are so much lower than the existing, already low margin contracts. It has 2 impacts, firstly obviously margin squeeze, but also sub-contractors are exiting as the new rates for them are not sustainable.
Click to expand...
that was the opinion i settled on as well the NBN was extremely erratic when first connected ( replaced the very adequate ADSL 2 ) after many emotional calls and six technician visits the NBN is useable at times and still drops out regularly

i would imagine the sub-contractors soak up a fair bit of the disharmony , of the shares i hold only SKI seems to be comfortable with their NBN relationship

PS i also hold LLC
 
A pick for 2022.

Very beaten up during 2021. Got a raising away in 2021 to fund purchase of Lend Lease service division. Trading below the issue price, but MAY have found a floor.

Either its going to rebound well or die a death.
 
Ferret said:
A pick for 2022.

Very beaten up during 2021. Got a raising away in 2021 to fund purchase of Lend Lease service division. Trading below the issue price, but MAY have found a floor.

Either its going to rebound well or die a death.
Click to expand...

You may be onto something, SSM seem to be slowly building.

SSM.png



Insiders who bought AU$2.3m worth of Service Stream Limited (ASX:SSM) stock in the last year have seen some of their losses recouped as the stock gained 10% last week.
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simplywall.st

Favorable turn of events for Service Stream Limited (ASX:SSM) insiders who've lost AU$102k to date on a AU$2.3m purchase

Insiders who bought AU$2.3m worth of Service Stream Limited ( ASX:SSM ) stock in the last year have seen some of their...
simplywall.st simplywall.st
 
Some good news today.

Group Highlights
  • Group Total Revenue of $566.2 million, up 38.1% vs. pcp
  • Group EBITDA from Operations of $39.3 million, underpinned by a solid operating result across
  • the legacy business and positive contribution from LLS operations post Completion
  • Rebased Group EBITDA from Operations margin 6.9%, in line with expectations
  • Adjusted NPAT of $16.4 million
  • Exceptional OCFBIT cash conversion of 234.9% and closing net debt of $47.1 million
  • Transformational Lendlease Services acquisition successfully completed 1 November:
  • All client contracts successfully transitioned
  • Integration program commenced and tracking to plan
  • Delivery of synergy targets validated and run-rate brought forward of schedule
  • 1H22 interim dividend not declared to assist with funding the LLS acquisition
  • Work in hand of $5.6 billion with solid pipeline of growth opportunities across all segments
 
SSM played a key part in Labor's NBN infrastructure build, could there be more coming?

A better connected Australia

35. Labor believes that ensuring Australians can benefit from world-class broadband and mobile infrastructure is critical for our prosperity and resilience, especially in the post COVID-19 era.​
​
36. Labor will ensure all Australians get fast, reliable and affordable broadband, no matter where they live or do business. We will leverage and improve the National Broadband Network to advance economic and social outcomes, and create experiences that improve quality of life.​
​
37. Labor will develop policies to leverage next-generation mobile technologies to support the competitiveness of domestic industries.​
​
38. Labor will improve mobile coverage in regional and vulnerable communities, including transport corridor black spots and areas with high natural disaster risk, ensuring these enhancements are guided by local needs.​
Click to expand...
​
Policy.png
 
Tough 2022 for SSM with a 19.4% dip in profit announced today. Management is confident in a bounce back in 2023 on the back of a full-year’s contribution from Lendlease Services.

A combination of today's news and the overall red day on the market saw the SSM share price decline 16.18% to 85.5c.
 
greggles said:
Tough 2022 for SSM with a 19.4% dip in profit announced today. Management is confident in a bounce back in 2023 on the back of a full-year’s contribution from Lendlease Services.

A combination of today's news and the overall red day on the market saw the SSM share price decline 16.18% to 85.5c.
Click to expand...

Took a punt today and purchased at their low.
 
If I pick this often enough, will it finally come good?

Unlikely, but I'm a glutton for punishment so with it starting the year just about at a new low, I've picked it again for the 2023 comp.
 
ATO TAX REFUND Leading essential network services company Service Stream Limited (ASX: SSM) advises that following the lodgment of its income tax return for financial year FY22, and the Australian Taxation Office (ATO) finalising its review of Service Stream’s eligibility under the temporary Loss Carry Back Tax Offset initiative (LCBT Initiative), Service Stream has today received a material tax refund in the amount of $50.2 million inclusive of interest (Tax Refund).

The ATO’s LCBT Initiative provides a refundable tax offset whereby eligible corporate entities can elect to carry back losses to prior years in which there were income tax liabilities. The offset effectively represents the tax the eligible entity would have saved if it was able to deduct the loss in the earlier year using the loss year tax rate.

The FY22 tax loss position primarily arose from a one-off tax deduction claimed on the acquired accrued revenue asset balance arising from the Lendlease Service transaction in November 2021. The refund is higher than the initial estimate included in Service Stream’s FY23 December interim financial statements, which recorded a current tax receivable of $7.9 million, due to the successful application of the LCBT initiative.

In the absence of the LCBT claim, Service Stream would have carried forward this tax loss to apply against tax payable in future income years. This refund provides an immediate cash flow benefit to Service Stream, but does not have any impact, other than refunded interest costs, on the FY23 operating result.
 
Hi @debtfree,

Below are just some thoughts (definitely not recommendations) which were instigated by your post based on a weekly timeframe.

Based on a daily timeframe it would appear as though SSM is currently forming an impulse wave 3 of 5.

It may also be worthy of note that there is an overhead gap between $0.9425 and $1.02 which may result in the formation of wave 4.

Cheers,
Rob
 
Take what you will from this.

"We first wrote about being on the wrong side of momentum and trending share markets in.."


1709604531713.png


Australian & global equities funds for advisers - Allan Gray

To perform differently, you have to behave differently. Our contrarian approach adds undervalued & overlooked investments to your clients’ portfolios.
www.allangray.com.au www.allangray.com.au

Commentary by Simon Mawhinney, Managing Director and Chief Investment Officer​

It has been a disappointing year for the relative performance of the Allan Gray Australia Equity strategy. It is tempting to point to stock-specific reasons for this underperformance, but our largest detractor from performance (Alumina) was mostly offset by our largest contributor (Newcrest Mining / Newmont). Our underperformance this year is not because of the performance of our outliers. It is instead due to significant trending or momentum in areas of the market in which we are underrepresented.​

We’ve been here before​

We first wrote about being on the wrong side of momentum and trending share markets in our September 2015 Quarterly Commentary and then again in December 2021.​
​
In the lead-up to late-2015, companies with defensive earnings characteristics were all the rage. Market participants bought these companies aggressively and sold cyclically-exposed companies to fund these acquisitions, which led to significant relative price dislocations. By late-2021, it was all about sexy disruptors and high-quality companies, with the boring old-world companies being used as the funding vehicles. Investing against these trends later proved very rewarding for investors. Today, size and liquidity appear to be major beneficiaries of the market’s trending, with large, liquid companies leading the field funded by the sale of smaller, less-liquid companies.​
​
Graph 1 shows the..​
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"
 

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