Philip O'Sullivan's Market Musings

Financial analysis from Dublin, Ireland

Market Musings 28/03/11

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(Disclaimer: I am a shareholder in Kentz plc and AstraZeneca plc)


Engineer Kentz reported its FY10 numbers this morning. Sales came in at $1057.4m, PBT $67.5m, backing out the finance lease obligations gives net cash of $205.5m and the full-year dividend was 10c. For reference, Bloomberg consensus was for sales of $1035.3m, PBT of $63.27m, net cash of $182m and a full-year dividend of 8.2c. So, it all looks a little ahead of what the market was expecting for 2010.


The group’s order backlog at the end of 2010 increased by 7.0% to $1,602.6m. On this, the group has decent visibility of projects (no great surprise given the nature of its work) with c.$932.2m of the backlog relating to work due in 2011 and the remaining $670.4m in 2012 and beyond. Management say: “Our current future prospects for Kentz from across our current and some new areas of operation exceed $3.7 billion”.


The company also comments on the recent unrest in MENA, saying that in the ytd this is had “no material impact”. On the outlook, the CEO says: “Our current trading is in line with expectations”, while the Chairman says: “I am pleased to report that the outlook for the coming year is very promising; we have exciting project opportunities in prospect and the management team in place to realise the full potential of our Company”.


Elsewhere, Readymix announced that takeover “discussions with all third parties have been terminated”, adding that “trading remains difficult in the construction industry throughout Ireland”. Tullow Oil disclosed that its Teak-2 exploration well off Ghana found 27 meters of oil and gas reservoirs.


While not of particular Irish interest, I note that AstraZeneca has reached a deal with the UK & US tax authorities on transfer pricing arrangements which has prompted it to up its 2011 core EPS target range from $6.45-6.75 to $6.90-7.20


Today’s “You don’t say?” gong goes to Goldman Sachs, which says that Irish government bonds will “continue to exhibit high volatility“.


Written by Philip O'Sullivan

March 28, 2011 at 6:27 am

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