Sharechat Logo

Daily ShareChat: Skellerup Holdings

By Jenny Ruth

Thursday 23rd April 2009

Text too small?
 Jenny Ruth

Demand from the wide range of industries which use Skellerup Holdings’ technical polymer products remains very weak and isn’t expected to recover in the short term," says Forsyth Barr analyst John Cairns.

But the company’s dairy liner business is very defensive and will provide a base level of earnings, he says. In early April, the company downgraded its earnings guidance for the year ending June to between $8 million and $9 million from its previous $11million in February, citing worse than expected deteriorations in its US and European markets. That compares with last year’s $14.7 million net profit. Cairns made no change to his EBIT (earnings before interest and tax) forecast of $19.8 million for 2009 but the company’s warning led him to downgrade his 2010 forecast from $21.7 million to $17 million. He made no change to his expected $14.6 million EBIT from agricultural earnings but cut his expected industrial earnings from $12.1 million to $6 million. He says Skellerup’s debt levels appear to be on the high side at $74 million, likely to fall to $66 million by June 30. The company has a $90 million multi-currency banking facility maturing in July 2010 which it is currently re-negotiating.

 

BROKER CALL:

 

Forsyth Barr rates SKL as HOLD.



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Skellerup shares rise to four-month high on earnings outlook, Craigs upgrades stock to buy
Skellerup shares surge, best performer on the NZX 50 Index, as profits seen rising
Skellerup beats guidance with 23% drop in FY profit
UPDATE Skellerup scotches $7.3 mln claim in rubber ring dispute
Skellerup in $7.3 mln stoush over faulty rubber rings
Skellerup shares sink 10 percent as 1H earnings disappoint; cuts annual guidance
Skellerup flags smaller profit in 2013, shares fall 3.5 percent
Skellerup taps Rakon CFO Graham Leaming for same role
Skellerup reports record profit, increases dividend
Skellerup shifts chief financial officer Keogh to new Agri division role