Kentz Share Discussion Threads

[davidosh] 07/4/2014 13:58

chector177....you must live in London ? Did you attend the Agm last year ? Do you even go to any Agms ? Most people are paid a fortune to go into London everyday...I am just trying to get to a meeting and paying my own way !

I attend over 70 every year. I do not live in London but I make the effort to meet management and take responsibility for my investments. I have a very significant holding in KENZ and will be at the Agm. However it is totally against good corporate governance and best communication with shareholders to have a ridiculously early start time !

Any shareholders more than 70 miles away from London will probably have to stay overnight in a London hotel to guarantee getting to the company HQ building for 8.45am ahead of the meeting. Why is the start time moving one hour earlier every year ?

Do they not want shareholders to attend in large numbers ? Will the company do a presentation to make the journey in rush hour commuter traffic worthwhile or is this more about starting the board meeting earlier so that they can have a very nice lunch afterwards ??

[chector177] 07/4/2014 13:33

I find if something is really important to me I can get up earlier. I could be wrong but I would have thought literally thousands of people manage to get into London before 9am everyday.

[sharesoc] 07/4/2014 13:24

Kentz Agm coming up:

The 2014 Annual General Meeting (AGM) of the Company will be held at 5 Chancery Lane, London, EC4A 1BL on Friday, 16 May 2014 at 9.00am.

Now lets look at the previous years Agm and the details for the meeting:

London, 17 May 2013: Kentz Corporation Limited ("Kentz" the "Company"), the holding company of the Kentz engineering and construction group ("the Group"), releases the following statement on the occasion of its Annual General Meeting, which is being held today at 10.00am in London.


London, 18 May 2012: Kentz Corporation Limited ("Kentz" the "Company"), the holding company of the Kentz engineering and construction group ("the Group"), releases the following interim management statement in advance of its Annual General Meeting which is being held today at 11.00am in London...

Looking at the copied text and the details of the Agms it is clear to see the start times are getting earlier each year. How do they expect shareholders especially those outside London to attend if they make the Agms so early? If you, like us at ShareSoc find this an issue please raise the matter with Kentz through their investor relations.

[phone]

Ronan Tyrrell, Head of Investor Relations

[ygor706] 07/4/2014 11:49

Still my favourite stock for 2014 and a lot of ISA managers seem to agree with me judging by this morning's share price performance!

[silverfern] 07/4/2014 11:43

doubled my holding this a.m.

[chector177] 07/4/2014 09:09

Yes Whizzy, red across my portfolio with the exception of KENZ

[whizzy1] 07/4/2014 08:00

Added along side of the $640 million deal in Feb, Australia's a bit of a gem it seems.

Edit:
Well timed as it looks like a stinker for the rest of the markets this morning.

[adamb1978] 07/4/2014 07:45

That's a whopper! $570m revenues over 2.5 years....

[rivaldo] 07/4/2014 07:05

Wow - another $570m of revenues in the bag, and "visibility to 2017" too....



"Kentz awarded a further US$570m contract for the Ichthys LNG Project

London, 7th April 2014- Kentz Corporation Limited (LSE:KENZ), the holding company of the Kentz engineering and construction group, is pleased to announce the award of an AUS$615m (US$570m) contract to it's Australian subsidiary for the Electrical and Instrumentation (E&I) construction packages for the Ichthys Project Onshore LNG Facilities in Darwin, Australia.

This contract was awarded by JKC Australia LNG Pty Ltd (JKC), a joint venture between JGC Corporation, KBR and Chiyoda Corporation. JKC is responsible for the engineering, procurement and construction of the Ichthys LNG Project's onshore facilities, including the gas processing plant at Blaydin Point.

The contract, for which site preparation work will commence in August 2014, has a duration of 30 months and will provide more than 1,200 jobs for construction personnel. The contract scope includes the provision of services for site wide E&I installation on a unit rate re-measurable basis for the two process trains and utilities, and additional pre-commissioning and commissioning expertise.

etc"

[apad] 06/4/2014 20:05

I've been waiting a while for someone with more accountancy competence than me to comment on cash flow and orders.
Thanks,
apad

[wexboy] 06/4/2014 17:12

Company: Kentz Corp

Prior Post(s): 2012 & 2013

Ticker: KENZ:LN

Price: GBP 750p

And Kentz marches ever onward... Shareholder must now be breathing a sigh of relief that management emphatically rejected the Amec and M&W Group bid approaches last August. There was a pretty measly premium on offer, anyway – so I suspect even a protracted bid battle wouldn't have produced an acceptable take-out price for shareholders. The excellent share price performance since is rousing confirmation of the wisdom of management's decision. But now we obviously have to wonder if the shares have gotten ahead of themselves..?

Well, the business continues to go from strength to strength. We've seen some large wins in the past 6 months – the $640 million Ichthys LNG Project & the 190 M Qatar Petroleum contract, for example. All told, the company now enjoys a 4.1 B backlog (as of end-Feb, up 58% from Dec-2012), and a colossal 15.6 B pipeline (up 18% yoy). It also pulled off a 435 M acquisition of Valerus Field Solutions, which adds an additional 493 M of revenue (and 51.5 M of EBITDA). Capping this, final results were released last week, which confirmed 17.3% EPS growth.

The operating profit margin's now 6.9%, on nearly 1.7 B of revenue, but this is tempered by continued working capital investment – not unusual for a company like Kentz. Considering the history of success, and the current backlog/pipeline, it might seem unfair to handicap my valuation because of this cash shortfall – but let's be conservative here: The current operating free cash flow margin is 3.4%, so let's average the two & utilize a 5.2% adjusted margin (or 85 M). But this allows us to be generous & assume 100% of the Valerus EBITDA will be realized as margin (at least on a cash basis). This bumps our adjusted margin up to 137 M, on a new revenue run-rate of almost 2.2 B – a 6.4% adjusted margin. This continues to deserve a 0.6 P/S multiple. With 400 M of the Valerus acquisition to be funded with a loan, interest expense should jump to around 21 M, a whisper over 15% of our adjusted margin. Therefore, we'll no longer add a (positive) debt adjustment, but we can certainly still adjust for the company's cash pile (247 M less 35 M earmarked for Valerus). Things are much simpler on the earnings front: EPS has increased by 17.3% & 19% in the past two years, and has generally exhibited similar/superior earnings growth in the past. I'll stretch to a 20 P/E multiple for that kind of quality:

(USD 0.681 EPS * 20 P/E + (2,150 M Revenue * 0.6 P/S + 212 M Cash) / 118 M Shares) / 2 / 1.6638 GBP/USD = GBP 792p

Kentz is probably the type of company (& sector) investors instantly love or hate...but judging by the figures & its long-term record, it remains marginally under-valued at this point. Barring some unforeseen project disaster, it's reasonable for shareholders to also expect another significant uplift in intrinsic value within the next year, based on the current backlog & pipeline. Not to get all starry-eyed, but it's worth highlighting Kentz' market cap is still under $1.5 B – a mere tiddler in the industry – which suggests its best growth opportunities may still be ahead, rather than behind it...

Price Target: GBP 792p

Upside/(Downside): 6%

_

[roddiemac2] 02/4/2014 09:45

Filtered by a pathetic ramper

[roddiemac2] 01/4/2014 19:49

It might rain tomorrow: so what?

[mirabeau] 01/4/2014 10:26

'£8 in days'..you may be proven correct W1

[whizzy1] 01/4/2014 10:23

Hmmm..... I'm wondering if this rise is on the coat tails of the Metso (speculation) bid from Weir?
Weir Group market value is some £5.4 billion pounds and certainly in the spending mood it seems for a bit of M&A.
More a mining and heavy engineering I'm thinking, but never the less, just shows there's big nmoney out there.

[roddiemac2] 27/3/2014 14:01

Whizzy1,

Nobody can say for sure what the shares will do in days . Does it matter ?

[whizzy1] 26/3/2014 12:32

Let's be blunt, the price drop from recent highs is simply a shake. £8 in days.

[bones] 26/3/2014 00:02

From Malcy's blog:

"The Kentz meeting yesterday was if anything more positive than I had been expecting, I see significant growth going forward and although the rating has indeed improved still feel that it will continue to deliver and is still excellent value."

[a0148009] 25/3/2014 22:45

Agreed - good point 1.7bn still a hell of a lot.

AO

[jeffian] 25/3/2014 19:53

I think the concept of "cost reimbursable" is reasonably watertight (I come from a builder/developer background and it sounds just like a "cost plus" contract to me, in which the builder provides an open-book tender process showing his sub-contract prices and you agree to reimburse him at cost plus a margin for him). Having said that, 78% still leaves 22% of £1.7bn to go wrong!

[a0148009] 25/3/2014 19:32

Jeffian - thanks I did see that in the results but nothing is cast iron especially when the lawyers get involved suing for negligence etc and the Times is making a point.They have grown very rapidly in the past few years having said that they are a top management team but there is no room for complacency.
I am confident that they will cover all the bases and continue grow - the pity about this business is very large contracts and small margins.

AO

[jeffian] 25/3/2014 18:53

The risk of mis-pricing contracts, which bit Lamprell and others, has been taken on board and they have addressed the issue head-on, shifting as much as they can to a "cost-reimbursable" basis. This from the latest results -


"Our backlog continues to offer a low risk profile for the Group with approximately 78% of the year-end backlog being cost-reimbursable."

[a0148009] 25/3/2014 18:04

This from the Times is so true, let's hope they do not overreach themselves have seen it many times in the past miss pricing a contract or eye is off the ball by being overstretched and taking on less qualified labour.

"Kentz has enough cash in the bank for its immediate needs. The risk in such businesses is always that one or more projects may go horribly wrong, but its record is a strong one."

With a $4.1 billion order book they can afford to be even more selective and increase margins.

AO