Member Info for jange

Galliford Try currently ticks all the right boxes. Taking 2015 estimates, the shares are offering a tasty yield and on 12 times earnings are not expensive. And business is set to improve still further, with housing demand boosting one side, while the long awaited infrastructure spend renaissance will help construction.

Galliford also has a significant construction operation that last year accounted for 62 per cent of group turnover, although only 15 per cent of profit. True, operating margins were skinny, falling from 2 per cent to 1.7 per cent, a trend that management expects to bottom out at around 1.4 per cent and compares with a 2.5 per cent peak in 2009. And profits last year dipped from £18.9m to £15.1m, mainly as a result of continued delays in the much promised resurgence in infrastructure spending. However, the order book has been maintained throughout the downturn, and in the year to last June actually increased marginally to £1.7bn, which is one of the most resilient performances in the sector. Analysts at Jefferies reckon that a good base-case valuation for the house building side is a rating of 1.6 times book value - that’s cheap compared with rivals such as Persimmon and Berkeley Group - making this part of the group worth 993p per share. That means that the construction side accounts for just 111p of the share price, which values this part of the business at a modest discount to the sector average rating of 11 times forecast 2014 earnings, despite the operation being one of the best performers. That seems unjustified.

Galliford Try's (GFRD) construction business offers bags of recovery potential while its house-building operation is currently in a sweet spot which is powering strong earnings and dividend growth. This looks a particularly attractive business mix at the present time but Galiford's rating does little to recognise its virtues, and there is an attractive prospective dividend yield on offer to boot. Pent up demand for new houses is resulting in a sharp increase in activity thanks to record low interest rates and government incentives to help first-time buyers that has seeded a housing boom that looks set to run. In this environment it would be easy for Galliford to adopt a 'pile 'em high and sell 'em cheap' strategy for its housebuilding business. However, it is actually taking a more disciplined approach that centres on building higher-quality homes in the more affluent parts of the country - notably the South, where the group has three-quarters of its operations. This approach is paying off nicely, with operating margin in the year to June rising from 11.8 per cent to 13.1 per cent. And management reckons that by 2018 this could rise further to around 18 per cent. For the current year to June 2014, all the land for projected output is already in place, with 90 per cent visibility also secured for the year after. And despite Galiford's more selective approach, forward sales at the year end were up 16 per cent to £405m. To meet rising demand, the land bank has been increased to a record 11,300 plots, and the proportion acquired at current (cheaper) market prices has risen from 81 per cent last year to 86 per cent. Moreover, the gross development value rose 14 per cent to £2.76bn last year, and there are a further 1,522 acres held in the strategic land bank. Acquiring more land used up the group's cash pile, but even so, net debt at the year-end was a modest £14.4m. True, average net debt throughout the year was £134m but this was still comfortably within the group's £325m banking facility.

Babcock's recovery story - both in terms of its balance sheet and order book pick up - has been running for a while, and the shares have run along with it. But they have dropped back from recent highs and now trade on a forward PE ratio of less than 16 times, accompanied by a nearly 3 per cent forward dividend yield, and the price-to-earnings-growth ratio, based on consensus forecast for the next 24 months, is just 0.9 times. This is a far from stretching valuation for a company with solid revenue visibility, obviously strong prospects of major contract wins and positive earnings momentum. In fact, Babcock’s PE ratio relative to the FTSE All-Share's is currently just over one times, which is well below the 2008 peak of around 1.6 times and also just below its five-year average. That implies this one has room to run

One potential downside of being so busy is that there can be initial outlay on bidding for and initialising new contracts. The operating margin in the support services division dropped last year for this very reason. But the drop was hardly calamitous: to 9.7 per cent, down from 10.9 per cent. What's more, this was offset by margin improvement in the other divisions such as the marine and technology operation. Income from the Future Strategic Tanker Aircraft joint venture increased the defence and security division margin, and the international division was lifted by strong market conditions in the South African equipment and crane hire operations. Net debt has historically been high as a result of the acquisition of VT in 2010, but strong cash generation means it is falling fast. In the latest financial year, Babcock met its aim once again of converting over 100 per cent of operating profit into cash, and net debt dropped £90m to £551m. So leverage ratios look far more comfortable now with net debt at 1.5 times cash profits from 1.8 times a year earlier.

Few companies can boast an order book that rivals a small country's GDP. But standing at a staggering £12bn, outsourcing giant Babcock's (BAB) certainly does. That order book ensures excellent visibility - indeed, the recent trading update confirmed that around 80 per cent of anticipated revenue for the current year is already contracted. And the order book does not look likely to tail off any time soon. At the full-year results, Babcock said that its bid pipeline - bids that can potentially become new contract wins - stands at a huge £15.5bn, up from £9.5bn a year earlier. That expansion comes as several big contracts move into the formal competitive process such as Magnox nuclear power station decommissioning and Ministry of Defence procurement work. The vast majority of the contracts would be sizable if secured, with almost three quarters of the pipeline comprising bids worth over £100m. The growth in the order book and bid pipeline are clear indicators of the health of Babcock’s end markets, as financial constraints push public and private sector clients towards outsourcing. Much of Babcock’s work is technically challenging and government-linked. This can be a PR disaster if the contract is mismanaged, as other companies in the support sector have found to their cost. But Babcock has so far lived up to its 'trusted to deliver' trademark, which should mean it's well placed for further work in these sensitive areas. Babcock is the only company to have pre-qualified for all six of the new Ministry of Defence Next Generation Estate Contracts programmes, which engage private companies to manage sites ranging from barracks to sports pitches. The company also says it is engaged in 'positive' discussions with the Ministry of Defence about the new Maritime Support Delivery Framework to replace existing warship support modernisation contracts, which would inject over £2bn into the order book on signing. So there is plenty of scope for share price-boosting news in the near-term.

Highlights: · Net assets as at 30 June 2013 of £3.22 million (2012: £4.45 million); including cash balances of £1.99 million (2012: £1.28 million) · Transition from Oil and Gas Exploration company to Investing Company completed · First significant investment under the newly adopted investing policy made

nearly 50% of shares taken up here............

hoe it continues

The production estimate is not a Mining Reserve as approximately 15% of the resource tonnage within the pit designs is classified as Inferred. It is intended to carry out infill drilling in the first half of 2014 to reclassify the Inferred Resource within the pit designs to enable a maiden Mining Reserve to be declared. If infill drilling results in the Inferred Resource being reclassified without a material change in tonnage or grade and there is no significant change in economic parameters, it is expected that a Mining Reserve of approximately 2.5 million ounces would be reported. Pit optimisation studies support the extension of the Bonecrusher pit to the south and an extension of the Dicksons pit to the north such that the crests of the two pits just meet on the current power line alignment, but do not fully connect. Based on current data the zone beneath the power line is not as well mineralised as the adjacent areas. This may in part be due to reduced drilling density and it is possible that with further drilling additional mineralisation could be identified which would warrant integration of the two pits, however there are no plans to evaluate this prior to relocation of the power lines. The optimisation work did not support a major relocation of Great Eastern Highway and the Goldfields Water Supply pipeline to extend the Dicksons pit south and the Phoenix pit north. However a minor realignment of the road and pipe line, which would enable an incremental northerly extension of the Phoenix pit, may be warranted and will be further evaluated at a later stage in the definitive feasibility study. Preliminary discussions have taken place with Western Power, Telstra Corporation and Main Roads Western Australia regarding realignment of the power line, communications cable and highway. No impediments to the relocation have been raised, however detailed design, engineering and costing are yet to be carried out. The revised pit outlines and conceptual infrastructure realignment are shown on the plan below. [The plan referred to is included in the version of this announcement appearing on the Company's website].

15 October 2013 AIM Code: BGL, ASX Code: BAB INTERNAL FORECAST OF MINE PRODUCTION INCREASED TO 2.5Moz CONTAINED GOLD · Economic benefit of infrastructure relocation confirmed · Estimated mine production increased by 5.4Mt containing 150,000 ounces of gold · Forecast production now 94.7Mt containing 2,562,000 ounces of gold · Estimated net cash flow increased by approximately $35 million at current spot gold price1 Bullabulling Gold Limited is pleased to report that on-going optimisation of the Bullabulling Gold Project has confirmed potential for further improvement in economic performance through the relocation of public infrastructure at the northern end of the project area. A series of four open pits have been proposed for development at Bullabulling. The northern most pits, Bonecrusher and Dicksons, are separated by an exclusion zone accommodating overhead power transmission lines and a below-ground telecommunications cable. Dicksons is separated from the Phoenix pit to the south by an easement for Great Eastern Highway and the Goldfields Water Supply pipeline. Revised mine designs based on the recently updated resource estimate (see release 19 September 2013) show that relocation of the power line and telecommunications cable would enable the Bonecrusher and Dicksons pits to be expanded to capture an additional 5.4 million tonnes grading 0.87g/t for 150,000 ounces of contained gold. This would take total forecast mine production over a projected mine life of approximately 13 years to 94.7 million tonnes at 0.84g/t for 2,562,000 ounces of contained gold. At the current spot gold price1, the additional production is estimated to increase potential net cash flow by approximately $35 million after allowing for infrastructure relocation costs, operating costs, metallurgical recovery and royalties.

On Thursday, Mexican silver miner Fresnillo (FRES) will be reporting its interims, following a trading statement from sector peer Rio Tinto on Tuesday.

Positive Points: The Group said it continues to perform in line with management's expectations. Net inflows were strongest in the group's debt products, which, combined with a positive investment performance helped increase assets under management to US$78.5 billion in respect of the quarter ended 30 September. Ashmore highlighted that the short-term fluctuations in emerging markets should not mask the long-term opportunity in emerging market debt and equities. The London based fund manager is a recognised leader in the management of emerging market debt.

Negative Points: The group remains susceptible to short-term volatility due to global macroeconomic weakness. Emerging market assets had suffered a sharp sell-off in May and June after the US central bank said it was considering cutting back on its monetary stimulus. Ashmore is exposed to foreign exchange risk. In addition, the group's revenue is denominated in US dollars, whilst the majority of the group's costs are sterling based. Consequently, Ashmore has an exposure to movements in the GBP/USD exchange rate. In the course of its normal activities, the company has exposure to credit risk.

Interim management statement: A brief announcement from the specialist emerging markets asset manager saw assets under management increase during the quarter through a combination of net inflows of US$0.6 billion and positive investment performance of US$0.5 billion. In broad-based demand, net inflows were strongest in blended debt, corporate debt and external debt while multi-strategy and local currency saw modest net outflows and smaller net outflows respectively. Elsewhere, equities and external debt contributed the most to investment performance during the period with other themes broadly flat. Mark Coombs, CEO commented: "Ashmore has continued to deliver net inflows during its first quarter, which is traditionally quieter and this year saw more volatile markets. This reflects the long-term investment approach taken by the Group's predominantly institutional clients. Although Emerging Market asset prices recovered in September, valuations across equity and fixed income markets remain attractive, particularly when compared to Developed Market alternatives that continue to face uncertainty owing to numerous economic and fiscal challenges. We therefore remain optimistic about the diverse range of Emerging Market investment opportunities that we can access on behalf of clients

Positive Points: The group highlighted that "in aggregate, including both the benefit from the share repurchase programme and downside arising from reductions to US defence budgets, double-digit growth in underlying earnings per share is anticipated for 2013." The group's guidance continues to anticipate a satisfactory completion to the Salam pricing negotiations this year. In February, the Group initiated a share repurchase programme of up to £1 billion over three years. As at 9 October, BAE Systems had purchased 34 million shares, for £134 million under the programme. Away from its key UK and US markets, International market activity remains vibrant with multiple opportunities being pursued. Building on order intake in 2012, £5 billion of non-UK/US order intake has been achieved in the year to date. The evolution of BAE Systems has seen the group's business develop from an equipment supply-centred model to one that now embraces a services culture. In 2012, 50% of the company's sales were generated in services across a wide range of activities and geographies. The current dividend remains attractive in a low interest rate environment (over 4.0% as of 10Oct13 - not guaranteed). A progressive dividend policy continues to be pursued - management declared a 3% increase in the interim dividend to 8.0 pence. The company's business portfolio is reviewed regularly to determine whether greater value can be created from the sale of a business rather than its retention. Three small business disposals were made during 2012 for a combined consideration of approximately £111 million. Group costs remain a management focus.

Negative Points: The company's current full year guidance assumes the satisfactory conclusion to its Salam (Kingdom of Saudi Arabia Typhoon aircraft purchases) pricing negotiations this year. Should negotiations extend beyond the year end, earnings per share for 2013 would be impacted by approximately 6 to 7 pence. Performance of the group's US-based businesses continues to be impacted by pressure on US government spending and the introduction of budget Sequestration measures resulting in ongoing defence budget uncertainty. Unless measures are introduced to mitigate the impact of Sequestration, defence spend is expected to face continued reduction. Since the 1 October US government shutdown, approximately 1,200 employees across the Intelligence & Security and Support Solutions businesses have been temporarily directed not to report to work. With the announcement of the full year results in February, BAE initiated a share repurchase programme of up to £1 billion over three years. However, full implementation of the programme remains subject to satisfactory resolution of the Salam Typhoon price escalation negotiations. Negotiations have generally proved challenging. Saudi Arabian defence spending may slow if oil prices significantly decline. Both group revenues and profits declined during the first half of 2013 and for the 2012 financial year compared to 2011. Due to various government stakeholder disagreements, merger talks between BAE Systems and EADS (now renamed Airbus) back in October 2012 were terminated. A combined BAE Systems and EADS would have established a company able to rival Boeing. Both BAE and EADS would have diversified their respective product profiles. Sales relationships for each may have been used to benefit the other. Cost savings may eventually have been made. Procurement and sourcing efficiencies available to the enlarged were expected to provide the early focus. Given reduced US government defence spending, major US competitors are also likely to be seeking sales elsewhere in the world.

Third quarter trading update: The news saw management announcing trading which had remained in line with its expectations as of the half year results. The share price rose marginally in early stockmarket trading. The board highlighted that "in aggregate, including both the benefit from the share repurchase programme and downside arising from reductions to US defence budgets, double-digit growth in underlying earnings per share is anticipated for 2013." In addition, it went on to note that "the group's guidance continues to anticipate a satisfactory completion to the Salam pricing negotiations this year. However, should negotiations extend beyond the year end, earnings per share for 2013 would be impacted by approximately 6 to 7 pence." On balance, and with ongoing uncertainties weighed against the support of a major share buy-back programme, expected full year growth in earnings and the share price up over 30% over the last year

Admittedly, the robust long-term growth profile of SAB Miller's emerging markets isn't really in doubt. The IMF believes that developing Asia, for instance, will see economic growth of 7 per cent in 2014 and that Africa's economy will grow nearly 6 per cent. But nearer-term pain is looking likely. SABMiller's shares trade on 19 times broker Numis' forecast earnings for end-March 2014, which is well ahead of shares in rival brewers such as Carlsberg (CARL) or Anheuser-Busch InBev (ABI) that trade on a less demanding 14-15 times forecast earnings. True, those players are more exposed to low growth developed markets. The shares own price-to-earnings-growth ratio, based on Bloomberg consensus 12-month forecasts, also looks high at 1.63 times, which is within a whisker of the five-year high of 1.66 and well above a five year average of 1.20. As growth stumbles at SABMiller, that premium rating could prove hard to sustain. A prospective yield of around 2 per cent, while in line for its peer group, doesn't set the heart racing as always dyor gl

SABMiller's more developed markets are unlikely to compensate for that, either. With July's trading update, management reported that "unseasonably cold and wet weather and continued weak consumer sentiment" had driven organic revenue down by 1 per cent in Europe. Overall, European lager volumes fell 7 per cent with an especially weak performance in Poland and the Czech Republic - volumes there slumped by 14 per cent and 11 per cent, respectively. While, in North America, a challenging environment and "significantly cooler weather" helped drive revenues from its MillerCoor's operation down 3 per cent in the quarter. But there's no denying SABMiller's market dominance. It's the number one brewer in most of its African markets, for instance, and boasts a 90 per cent slice of South Africa's market. It dominates Latin America, too - from the seven Latin American markets in which it operates, it has market shares of above 90 per cent in five of them. It also has a 29 per cent slice of the US beer market, 21 per cent of China's, 23 per cent of India's and 45 per cent of Australia's. That position in Australia was generated on the back of 2011's $A10.5bn (£6.2bn) acquisition of Foster's - a deal that's expected to deliver A$180m a year in cost synergies by March 2016. SABMiller also has primary brewing operating in eight European countries and, for most of these, it's either the number one or number two player. It boasts some impressive global brands, too - including such popular offerings as Carling Black Label, Coors Light, Grolsch, Pilsner Urquell and Foster's.