Manufacturing
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ResMed in a Holding Pattern
Ben MacNevin
January 31, 2014
ResMed (ASX: RMD) has released its second quarter result for 2014, and once again it was a tale of two cities: the top line growth disappointed, while the bottom line growth impressed. So, amid these two opposing forces, which direction will the company likely take? continue…
by Ben MacNevin Posted in Health Care, Insightful Insights, Manufacturing.
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Australia: Time for Rejoicing?
Roger Montgomery
December 23, 2013
Whenever I have been asked to nominate the worst industries to invest in, I have always cited car manufacturing and airlines. Car manufacturing is an exercise in labour and capital intensive fashion design, while airlines suffer from being input price takers, are beholden (pun intended) to unionised labour, irrational competition and competitors who can secure their fuel for free. And if a commodity is anything that is purchased purely on price and where brand isn’t a consideration, then airlines are selling a commodity too. continue…
by Roger Montgomery Posted in Airlines, Insightful Insights, Manufacturing.
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MEDIA
Holden to cut 500 Australian jobs
Roger Montgomery
April 8, 2013
In this interview on ABC1’s ‘The Business’, Roger discusses with Ticky Fullerton his reaction to the news that car manufacturer Holden is to cut 500 jobs in Adelaide and Melbourne. Watch here.
by Roger Montgomery Posted in Manufacturing, TV Appearances.
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- POSTED IN Manufacturing, TV Appearances
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The slow demise of Australian manufacturing?
David Buckland
March 15, 2013
In 1983, 19 per cent of the Australian workforce was in the manufacturing sector. This year, that figure stands at just 9 per cent.
This decline is a common trend across the western world.
So what’s happening to Australian manufacturing and where’s it going?
continue…by David Buckland Posted in Insightful Insights, Manufacturing.
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Vehicle demand on the rise
Roger Montgomery
March 11, 2013
If you are an investor in ARB or any listed business exposed to car sales such as Super Retail Group or Automotive Holdings, you may be interested in the latest Vfacts stats below that were kindly sent to us by our friends at broker Taylor Collison.
continue…by Roger Montgomery Posted in Insightful Insights, Manufacturing.
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Tailoring the right fit for Pumpkin Patch
Ben MacNevin
January 31, 2013
Pumpkin Patch is a New Zealand company that specializes in higher-end children’s wear. The company began in New Zealand in 1990 and expanded into Australia in 1993, and has managed to reach mature growth in both markets. Many Australasian retailers that reach mature growth will use their positions to support overseas expansions. Pumpkin Patch has managed to launch a profitable wholesale business by signing distribution agreements to hundreds of department stores around the world. However, its store rollout into the UK in 2001 and the US in 2005 has really hurt the company. This retail model was never profitable, and while a high New Zealand dollar and sluggish retail environment did little to help their margins, management were unable to replicate the success of the Australasian stores. The company accumulated NZD13.5 million of retained losses before management made the decision to close their UK and US stores and focus on their online and wholesale divisions.
continue…by Ben MacNevin Posted in Consumer discretionary, Insightful Insights, Manufacturing.
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More choice and lower prices? Fat chance.
Roger Montgomery
December 6, 2012
Rising costs, lower productivity and a strong Australian dollar will inevitably be blamed for the collapse of another food manufacturer in Australia this week.
Gourmet Group, the company that owns the iconic Rosella Brand of tomato sauce has been placed in receivership with reports it owes as much as $50 million.
But this additional nail in the coffin of our collapsing food manufacturing industry is exactly what the government wants, it may also be what the ACCC wants and it is what Australian consumers want. And if they all complain that they don’t want it, it’s what they’re going to get.
by Roger Montgomery Posted in Insightful Insights, Manufacturing.
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Changes in the car market – enduring or short-term?
Roger Montgomery
November 12, 2012
AMA, MXI, AHE and ARP share prices are all booming on the back of surging demand in an under supplied car market, causing a shortage of capacity which is driving up margins for the sector’s operators.
You can read one of our recent post on the subject here.
Naturally we have been drawn to the operators in the sector on the back of this capacity shortage. The ability to charge higher prices in a capacity-constrained environment is great if they are enduring, but I must ask, is the entire sector in a little bubble? A bubble in profitability and short-term market growth?
continue…by Roger Montgomery Posted in Companies, Insightful Insights, Manufacturing.
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New Car Anyone?
Roger Montgomery
November 8, 2012
By Russell Muldoon & Roger Montgomery
We like to keep an eye on monthly new car sales statistics produced by the Federal Chamber of Automotive Industries. For a number of businesses we are interested in, including Carsales and ARB Corporation, they are both beneficiaries of a high level of new vehicle turnover.
by Roger Montgomery Posted in Insightful Insights, Investing Education, Manufacturing.
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When a ‘Sighting Shot’ is the only shot
Roger Montgomery
October 31, 2012
We have been watching with some interest the attempts by the Steelmakers Australia consortium to engage with the Arrium board (not that we have ever owned shares in Arrium).
Often in an unsolicited takeover offer, the initial bid will be a “sighting shot”, which the board will quickly reject. According to the conventional storyline, the bidder then ups the offer, the target board relents, and shareholders are left with the impression that the board has managed to secure a better deal for them.
In the case of the Arrium bid, Steelmakers Australia appears to have diverted somewhat from the standard script. They have come back with some modifications to their original proposal (shorter due diligence, evidence of funding capacity), but have not lifted the price.
This is not be a good sign for the Arrium board, nor its shareholders. It indicates that Steelmakers Australia sees itself having a strong negotiating position.
The reason for this may be the $2.14b of debt on Arrium’s books. Steelmakers Australia may expect that Arrium’s directors will be reluctant to negotiate too hard lest the offer disappear, leaving the debt problem to be resolved by the board.
by Roger Montgomery Posted in Insightful Insights, Manufacturing.
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