Emeco (EHL) wins new contract
Emeco Holdings (EHL) +2.84%: the contractor was higher today on updated guidance and a new contract win. Newly acquired subsidiary Pit N Portal secured a 5 year contract with Mincor (MCR) to develop the underground mining contract at the Kambalda Nickel site in WA – Mincor itself is an interesting smaller cap nickel name with some interest from BHP as well as Andrew ‘Twiggy’ Forest. Emeco also gave FY20 guidance of operating EBITDA at $244-247m, a tight spread with the analyst expectations at the top end of the range.
Despite this, the guidance was seen as a positive by the market, with EHL smacked around with COVID-19 on growing concerns that their earnings would take a hit. Today’s announcement shows nothing has changed, particularly on the leverage side with the company targeting 1.5x net debt to operating EBITDA, unchanged from the half year result. We like EHL.
Emeco Holdings (EHL) Chart
