Hydro Intl Share Discussion Threads

[quickmind] 23/9/2006 20:44

- rivaldo
I'm with you; it is indeed many years ago. It's just that there must be a good fundamental reason for a fall of such magnitude over a period of four years -- I mean the extend is beyond Mr. Market.

I did a bit further digging. HYD increased revenue from £3.13M for 1996 to £18.64M for the year ended 31 Dec. 2005. That's 22% revenue growth p.a. for the past nine years.

- cheap, NHB
Many thanks for your input.

[nhb] 23/9/2006 10:53

Hi Folks,

For my sins I have been a permanent holder of this share since before 9/11. I bought at 22p & 33p plus a few more later on. My memory of articles at the time is that HYD over-expanded early on. Management was changed. They had the one-off license payments from South Korea and Japan. It was also probably floated too early and the market didn't realise what a long-term play it was.

NHB

[cheap] 22/9/2006 17:20

quickmind, as far as I recall, there was the characteristic overvaluation at flotation and possibly the sudden access to money meant expenses weren't watched as carefully as they should have been and perhaps the excellent and independently verified quality of the products left the company with the impression that they would market themselves. It was more an R&D company than a marketing one which always causes problems but particularly in as slow moving and conservative industry as water.
Also the whole industry failed to understand that the regulatory 5 year asset management programmes would create such dramatic peaks and troughs in business, with sales being compressed into the last 2 years of each period. Hydro now has a spread of business that does much to smooth those irregularities out.
Again the company had won tremendous accolades for its show projects in the US monitored by the Environmental Protection Agency and there was a failure to understand that such success was only really going to be rewarded over a twenty year period in which increasing environmental legislation played a major part.
The company learned a great deal from these set backs and it has helped them considerably in what they are now achieving.

[rivaldo] 22/9/2006 12:14

Hi quickmind. No idea I'm afraid! A bit too far back to worry about imo - HYD will now be a different company with different management, global growth possibilities, a wider product range, decent recurring income etc - and of course the current environmental imperative was barely a blip on the horizon in those days.

It would be interesting to know why of course. But looking at the news flow and company direction over the last couple of years spells things out nicely for me.

[quickmind] 22/9/2006 11:40

- rivaldo
I think the company has made good progress in recent years; and the shares at this price look interesting. But do you happen to know the reason why the share price fell from near 100p in 1995 to below 20p in 1999?

[rivaldo] 20/9/2006 12:04

Quiet here whilst I've been away!

Looks like the share price has woken up. And there's a nice spread of only 3p for those interested in buying.

[rivaldo] 01/9/2006 12:22

Jebenn1, ta for your post 1368. Appreciated.

Still moving up on each buy!

[rogerbridge] 31/8/2006 22:19

Deserved tick up today.

[jebenn1] 31/8/2006 15:38

I for one appreciate your constant attention Rivaldo!
Many thanks for your investigative reporting.

A company which I bought into after seeing it mentioned on this board, Amiad Filtration, has had a couple of good days with no apparent news flow. I wonder if HYD's news eposure is benefitting Amiad (AFS). Or possibly a broker note on water companies which hasn;t come to light yet?

[rivaldo] 31/8/2006 15:04

Sorry about the running commentary, but this doesn't happen very often on HYD -moving on every buy it seems :o))

[rivaldo] 31/8/2006 14:33

Two buys today and moved up on each buy! Exciting stuff by HYD's standards...

[rivaldo] 31/8/2006 09:47

Good to see the price moving up on small post-results buying.

[rivaldo] 30/8/2006 19:14

Good AFX coverage today:

"LONDON (AFX) - Hydro International PLC said it sees further growth for the
full year after it raised pretax profit in the first half of 2006 to 602,000 stg from 331,000 stg, in line with expectations.

The order book at the end of June was up 34 pct to 7.2 mln stg. Turnover in the half-year grew by 4.5 mln stg to 11.02 mln.

In England and Wales the regulated water industry completed the first full
year of its fourth asset management program (AMP4) in the group's half-year. As
anticipated, the programme is back end loaded and has got off to a relatively
slow start though Hydro said it is pleasing to report that proposal activity for Hydro's portfolio of wastewater products, enhanced with 2005's acquisition of Vexamus Water, is at encouraging levels.

Chairman Roger Lockwood said that despite some AMP4 procurement lag and
delays in US wastewater projects, as indicated in the group's AGM trading
statement, and providing there is no significant economic downturn, the group
anticipates delivering further growth for the year as a whole with the financial results of the two halves expected to be proportionately similar to those of the previous year, before exceptionals.

Hydro also said its Clevedon based stormwater business has delivered a solid
performance for the first six months of 2006 with enquiries, orders and sales
continuing at encouraging levels.

HRD Technologies Ltd, the group's Irish subsidiary, has also delivered a
strong result for the first six months of 2006.

And the Stormwater division in the US has had a good start to the year
building on the advances made in 2005. Activity in both the wastewater and
combined sewer overflow (CSO) sector is lagging behind expectations due to
delays in project approvals and funding. However, proposal activity remains
buoyant and there are indications that bid activity is likely to increase
through the latter part of the year.

[e-mail]"

[rivaldo] 30/8/2006 11:51

Hi Woodsman. I made a mistake in my calculations which means potential EPS this year is actually much higher, and certainly higher than current broker forecasts!

H1 produced £491k PAT before amortisation. Last year HYD made £450k PAT in H1 and £733k in H2. On the basis of the same proportions this year (as suggested in today's outlook statement) HYD should therefore make £800k in H2 and £1.29m for the 2006 year.

That's around 9.2p EPS this year, far higher than the 8.61p broker estimate. And a P/E of only just over 12.

No wonder the price is up :o))

[woodsman2004] 30/8/2006 09:29

Yes steady she goes - at least these results will not attract ramping rifraff to this bb!

As the management repeatedly makes clear, it is a long and awkward process to win these kinds of public sector contracts etc, legislation etc etc

However, we do know that this company has been doing the legwork - building competance and relationships. We also know that environmental, political and social factors are moving decidedly in our favour. So with a bit of luck, when the cork finally comes out of the bottle, HYD should be well placed to profit.

In the meantime the risks are relatively low - the company is profit making and cash-generating. So I agree with Rivaldo this is a good long term hold and I will continue to buy on any weakness.

[rivaldo] 30/8/2006 07:37

Results out!


Pretty good if not spectacular. They've omitted the adjusted EPS, which net of goodwill amortisation I make 3.5p for H1. They say the result for the year will be in the same proportions as last year, and again I calculate that would give around 8p EPS for the year.

That's a current year P/E of just over 14, which is fine given that for example HYD now has £2.3m of net cash against a £16.5m m/cap.

The order book is up 34%, and given the slow start to AMP4 any upturn in this area should mark a bigger upturn for HYD.

Steady as she goes. The prospects and international potential (particularly in the USA) make this a nice long-term hold imo.

[rogerbridge] 24/8/2006 21:19

As you have said previously Rivaldo, a growing market.

[rivaldo] 22/8/2006 08:18

Big news coverage at present about the threat from coastal erosion and the consequent flood risks. Interesting to note that in February 2006 a government-led conference took place with HYD as one of the seven sponsors on Development and Flood Risk, including coastal erosion:



"Around 10% of England, by land area, population and housing stock, is within areas of significant flood risk. The planning system has to work with this reality. While development must avoid flood risk where possible and be managed elsewhere, we have to ensure existing communities in such areas can wherever possible continue to be sustainable and are not blighted.

Climate change is predicted to increase future flood risk. But a combined response, with planning playing a key role, can manage the risk."

[rivaldo] 21/8/2006 22:56

Nice article here from February which my news alert has just picked up for some reason. All about Vexamus and solutions for the treatment of waste water –either municipal sewage or industrial effluent, again must-haves in today's environment:



"A patented Norwegian water filtration system is now available for installation across the UK, and further afield, thanks to a new partnership forged by the IRC network. The compact technology occupies one-tenth of the space of the sedimentation systems it will replace. It also brings cost savings and reductions in unpleasant odours. The companies, their clients and the environment can all win as the innovative filter spreads across Europe.

Removing unwanted materials from water is one of the most vital technological processes of civilisation. We need clean water for drinking, washing and industrial manufacture, and we must treat domestic and industrial waste water before it returns to rivers, lakes and the sea.

The origins of water-treatment technology are ancient, but it is an ever-advancing field, with continual demand for more efficient and cost-effective methods.

Filtration innovation
Salsnes Filter of Norway has developed anew patented filtration technology designed principally for the treatment of waste water –either municipal sewage or industrial effluent.

The system is highly efficient and can cut treatment costs by half. It is also extremely compact, occupying only one tenth of the space of more conventional alternatives based on sedimentation.

The technology is based on use of a fine polyester filter screen which can be adapted to many different applications by changing the mesh size.

One of its greatest advantages is that it incorporates a continuous self-cleaning procedure for the filter, based on a patented air-blowing system.

This is a significant step forward compared to traditional filtering methods,which either have to be batch processes,wasting time and labour, or must involve regular stages of cleaning the filter with water.

The filtration specifications that can be chieved by the Norwegian firm's technology are very high, removing solid particles down to the 15-30 micron range.

An efficient'sludge dewatering system' recovers water from the sludge that is initially gathered,ensuring that the final output sludge is between 25% and 35% dry matter.

This significantly reduces the volume of solid waste to be disposed of, compared to competing methods.

The dewatering system is also useful for the recovery and recycling of raw materials within industrial waste water.

An additional advantage can be a reduction in unpleasant odours released at the treatment plant, because the sludge is removed before microbial digestion processes that generate the odours get underway..

The partner search
Over recent years, the Salsnes Filter technology has been adopted in several countries world wide, including the USA,Canada, South Africa and Taiwan.

But early in 2003 the firm was keen to find new partners to help extend its use, especially across Europe.

"We approached IRC Norway to help with our search for partners, and very quickly received many good contacts," explains Jo Terje Lestum, of Salsnes Filter.

One of these leads through IRC East of England has nowled to a firm agreement with Vexamus Water, of the United Kingdom.

There is scope for selling the water treatment systems in the UK because many municipal waste water plants are overloaded,a range of industries which need waste water-treatment systems are flourishing, and space for the physical expansion of existing treatment systems is often very limited.

With many reasons for being enthusiastic about signing up a UK partner, Lestum soon organised a visit to Vexamus Water, and that initial contact was quickly reciprocated in a visit by Vexamus staff to some ofSalsnes Filter's existing installations in Norway.

"The visit to Norway was the crucial step,when both sides became very committed totaking collaboration forward," says Lestum.

The UK and beyond
Vexamus Water is now working with Salsnes Filter to sell and install the equipment throughout the UK market.

The agreement includes a signifcant training element, in which Vexamus staff will spend time in Norway learning everything about how the system is built, operated and maintained.

Vexamus Water has a large and well established customer base in the UK and a modern design centre for its own systems.

The company has also recently become part of the large Hydro-International Group."The addition of the Salsnes Filtertechnology keeps us ahead of the game inoffering the latest technology," says SteveTansley, operations director of Vexamus Water.

Vexamus Water has already delivered one ofthe Salsnes Filter units to a UK customer,and they now hope to build its penetration into the market quite steadily.

They expect the most immediate impact will be in the industrial sector, which tends to adopt innovative technology quite quickly.

The municipal waste water sector is slower moving, and dependent on government funding and political priorities, but it does contain clear need for expansion and modernisation which Vexamus Water hope to become involved in eventually.

The ten fold increase in the efficient use of space offers a major advantage for upgrading overloaded municipal plants.

Waste water treatment plants are generally regarded as eyes ores rather than architectural delights,so technology that keeps them as small as possible should be popular with planners and the public.

As happens in many of the best partnerships, this one opens up more possibilities than the specific deal that first brought the partners together.

For example,Lestum is pleased that Salsnes Filter is nowable to tap into the good network of contacts that Vexamus Water has around the world.He reports that this has already led to possible new business opportunities in Italy.

On the other side of the coin, Tansley of Vexamus Water is interested in exploring reciprocal agreements with Salsnes Filter, in which they might work with some of Vexamus's own technology within Norway.

These wider possibilities are in their early days, but they demonstrate how a first successful contact between companies can soon develop into a deeper and more profitable alliance."

[rivaldo] 05/8/2006 17:23

Good to see HYD's upward trend resumed last week...

From the USA:

"Join Hydro International for Gary Minton's
"Stormwater Treatment in Cold Climate Regions"

Dr. Gary Minton will present his Stormwater Treatment in Cold Climate Regions in Madison, Wisconsin on November 1 & 2 and in Portland, Maine on November 8 & 9. This is a must for consultants, municipal planners, engineers and others who are responsible for stormwater management

Hydro International invites you to join us for two days of information, education and interaction with other stormwater industry professionals. This is a unique opportunity to get the most up to date information on stormwater treatment.

The short course presented by Dr. Gary Minton is based on his book, Stormwater Treatment: Biological Chemical and Engineering Principles. It is the only book that describes the underlying engineering and scientific principles of stormwater treatment BMPs and their relationship to design criteria and performance. The course content will focus on technical aspects relevant to cold climate regions, discussing what is known from field studies regarding BMP performance."