Steppe Cement Share Discussion Threads

[jailbird] 16/4/2020 12:03

Wilo You read posts 2665 and 2675, these do not read too clever now these have been under pressure for some time and clearly someone has been selling from 30s+ just others having been averaging down and buying .Just have to wait for next update but expect cement growth to slow in the near term The virus or global recession does not differentiate all stocks . Once negative sentiments take over , everything goes .

[wilo101] 16/4/2020 12:03

PC Ken: the Group owns a fleet of cement hoppers/wagons, purchased at less than even the cost of the metal, brand-new from the Ukraine at the height of their crisis, one of the steals-of-the-century thanks to Vladimir the impaler and his geo-politics, such a deal was unimaginable but was pulled off, such purchase of the fleet was financed by long-term cheap VTB Austria debt, previously the Group had to lease the same, and paid through the nose and wagons were not always available when needed, especially in the key season. So, in effect the Group is also in the rolling stock business but this is worth its weight in gold. The entire assets and plant and mines, which is all a normal cement company has is debt-free and has cash on hand of US$6m!

The top shareholders self-underwrote three rights issues and put there money back into the company - no other regional cement plant is debt-free.

Do you now understand?

[mattjos] 16/4/2020 11:58

as i indicated, i am doing a direct comparison FY17 to FY19.

The issue of the FY17 results and then Q1 18 data was when share price was at this level

The progress made by the company in the intervening two years is unarguable by those with even passing familiarity with the company

[constable ken] 16/4/2020 11:45

you're cherrypicking

local market share q1 2018 14%; q1 2019 17.4%; q1 2020 13.3%


"Then if we look at 1st Q 2018 v 1st Q 2020:

Q1 2018 - Revs: KZT2.3m Sales Vol: 197kt Ave. Ex-Factory Price: KZT11,732/t

Q1 2020 - Revs: KZT4.0m Sales Vol: 235kt Ave. Ex-Factory Price: KZT16,970/t"

But
Q1 2019 - Revs: KZT4.455b (not m) Sales Vol: 266kt Ave. Ex-Factory Price: KZT16723/t

[mattjos] 16/4/2020 11:28

Share price back to where it was in Spring 2018.

This looks a complete nonsense when you compare Prelim Results update for FY 2019 as compared to the one issued for FY2017:

Y/E 31.12.17 - Revs: KZT21.4m Sales Vol: 1.63mt Ave. Ex-Factory Price: US$33/t

Y/E 31.12.19 - Revs: KZT30.5m Sales Vol: 1.71mt Ave. Ex-Factory Price: US$39/t

Local Market Share was 17% in 2017 & 17.5% in 2019


Then if we look at 1st Q 2018 v 1st Q 2020:

Q1 2018 - Revs: KZT2.3m Sales Vol: 197kt Ave. Ex-Factory Price: KZT11,732/t

Q1 2020 - Revs: KZT4.0m Sales Vol: 235kt Ave. Ex-Factory Price: KZT16,970/t

The company paid 1p/share divi in June 2018 for the FY17 Results

On every metric, STCM is far ahead of where it was this time 2018 but, the share price remains the same. Construction may get pegged back for a month or so, but that just means the demand will spring back very fast into the summer months, when I expect there to be a clamour for cement & resulting rising prices.
Steppe management are doing absolutely the right thing in keeping the factory operating at capacity. If, given the current climate, it is an easy ask to defer principal debt payments for a couple of months then, so they should & in fact daft not to, afaic

Price here is all wrong & so I have been adding more at under 20p

[constable ken] 16/4/2020 11:18

"effectively debt free" yet "postponing principal debt payment where possible"

care to explain?

[wilo101] 16/4/2020 10:24

Jailbird, just because the company can, as VTB is amenable now on the long-term new wagons finance, so why not and is prudent to do so, and otherwise the company has no debt and as noted for the first time ever no winter seasonal debt financing, the Government in Kz is not shuttering building and construction, so all should be OK, only - so far only 1341 Covid-19 cases in Kz, 263 cured and 17 deaths, in Karaganda where the plant is only 84 cases, 2 cured and 1 death, so, so far not too bad and the company's confidence can be seen from keeping the factory at full production, but time will tell what really happens and how things develop

[jailbird] 14/4/2020 13:50

Zangdook,I agree with you there, as I have family there .. 32C all the year around But one thing I will say is Singapore does have high humidity all the time but it does not have blue sunshine all the year around .. tends to me hazy cloud 80% of the year in total Maybe having direct sun rays can slow the retention period of the virus ?

[jailbird] 14/4/2020 13:40

WiloIf the Co has postponed debt payments to preserve cash , does that not tell you the dividend will also likely not be given ?

[wilo101] 14/4/2020 13:06

See the article by [e-mail], in today's WSJ, many physicians see it petering out as the northern hemisphere warns up, as did SARS, plus for STCM all the real money is made in late May early June through October, the company has lots of cash having financed itself for the first time ever all winter, no seasonal loans and facilities a-plenty to draw down, last year the dividend was not announced until June!

[zangdook] 14/4/2020 11:25

Are you mentioning the warm weather because of some relevance to cement demand? If you mean the virus, the surge in cases in Singapore kind of puts paid to the idea that it will go away for the summer.

[wilo101] 14/4/2020 09:45

Oh ye of little faith, I am quite sure I know more than you, and will be proven right, yet again.

[podgyted] 14/4/2020 09:29

The final paragraph of the RNS basically says no dividend.

Q2 is going to be the worst quarter if CV19 plays out as most people expect - can't see a BoD proposing a dividend in those circumstances. At best will be deferred - still worth watching, but only just.

[jailbird] 14/4/2020 08:16

What's good WiloThe decrease in cement demand is clear now, my cautious negative view has come true but that is no surprise Because of Covid 19Postponing debt payments Dividends - just cannot see that happening now As market will look forward , there is no reason for the share to rise above 30p now

[jeanesy] 14/4/2020 08:11

I cant agree. Sold at a big loss.

[wilo101] 14/4/2020 08:04

Not too bad, the Group is effectively debt free and has strong support from its top big 4 shareholders/founders and generous credit lines from liquid banks should the need ever arise, which hopefully it will not, so all depends for 2020 how the Covid-19 affects the construction sector though the warm weather is coming, and is already there in the south.

[glawsiain] 14/4/2020 07:32

RNS out

Market update for the quarter ended 31 March 2020

In the first quarter of 2020, Steppe Cement Ltd ("Steppe Cement" or the "Company") sold 235,896 tonnes of cement for 4,003 million Tenge, compared to 266,393 tonnes of cement for 4,455 million Tenge in the first quarter of 2019, representing a decrease of 11% and 10% respectively as the Company decided to maintain pricing over volumes in Q1 while in the previous quarters volumes had been maintained over pricing.

The Kazakh cement market in Q1 2020 increased by 15% over the corresponding quarter last year.

Steppe Cement's market share decreased to 13.3% in the first quarter of 2020 from 17.4% in the first quarter of 2019.

The average price for delivered cement in Q1 was 16,970 Tenge per tonne (ex VAT) compared with 16,723 Tenge per tonne in the corresponding quarter of 2019, an increase of 1%. Prices have been maintained this winter at the same level as last year.

The ex-factory price for the current quarter stood at 13,149 Tenge per tonne, compared to 13,614 Tenge per tonne in 1Q 2019, a decrease of 3%. The higher transport tariffs and rental expenses were due to increased sales in markets further from the factory and lower sales volumes to defray these costs.

Exports from Kazakhstan have increased by 34% from 2019 but it is difficult to have visibility over the output in the coming months.

The Company estimates Kazakhstan's cement market demand will decrease due to the uncertainty of oil market and negative effects from Covid-19. We continue to operate the factory at capacity and we do not anticipate any liquidity problems, as we have more than USD 6 million in cash, sufficient clinker in store, credit lines from the main banks in Kazakhstan and we are postponing principal debt payment where possible.

[jeanesy] 07/4/2020 20:02

Dumping stock they sure are .. a 200k and 175k dumped today. I am amazed this has not fallen further .. yet !

[jailbird] 07/4/2020 10:54

I think you need to remain objective when invested We are in difficult times , and tipping towards a global recession All sectors will impacted Have to accept this it is possible that future growth could be impacted Dividend could be withdrawnThere maybe no dividend the year after I am not ruling out any of these until a RNS tells me otherwise.

[zangdook] 07/4/2020 10:40

Someone's slowly dumping stock but they were doing that in previous years too. I don't think we can assume anything about the dividend from the pattern of trades.

[wanobi] 06/4/2020 17:53

you just cannot predict anything in this market jeanesy,,, personally I think it best to just hang on in there and give this thing time,,, I believe all will be fine, divi or no divi,,,, these are extraordinary times :-) Cheers Wan :-)

[jeanesy] 06/4/2020 17:50

Share price continues to fall. Will be under 20p pretty soon it seems. Really cant see a dividend here. price action says it all really .. sadly :(

[wilo101] 01/4/2020 03:39

hxxps://www.coronavirus2020.kz/

[kenmitch] 31/3/2020 19:13

And so far Kazakhstan not badly hit by coronavirus.

[wanobi] 31/3/2020 18:13

not disagreeing with you on that jeanesy, but, will say I've seen reports on CNBC/BBG TV of many shares rising significantly (10-20%) with the announcement that the divi will not be paid in order to strengthen the balance sheet through these difficult times etc etc,,,, so all not lost either way :-) Cheers Wan :-)