Proving the doubters wrong
Proving the doubters wrongNorthbridge’s results for the 6 months to June were most encouraging, with revenues falling just 4.5% and adj. PBT maintained at breakeven.
While the pandemic reduced higher margin hire revenues, the performance of the Group’s North American operations represented particularly good news. Recovery commenced from August within hire and the strong manufacturing order book translated to revenues from Q2. We anticipate normal trading levels resuming from FY21.
Despite hire service revenues adversely affected during Q2, particularly at the higher margin Crestchic, the manufacturing arm of the loadbank/transformer supplier performed very strongly due to record order books.
The balance sheet remains strong, with management extending the facilities for the RCF and the loan notes by 12 months to June 2022. We anticipate net debt reducing to £5.4m by the year-end, representing gearing of only 18% and a net debt/EBITDA ratio of just 0.9x.
The shares are well underpinned by the NAV per share of 109p, itself backed by a combination of freehold property and the hire fleet. On EV/EBITDA multiples we see Northbridge trading at a 40% discount to its peer group. With the shares trading only modestly above 12-month lows, we believe they are yet to fairly reflect the recovery underway.
Halliburton assists its customers throughout the lifecycle of the reservoir, from locating hydrocarbons and managing geological data, to drilling and formation evaluation, well construction and completion and optimizing production throughout the life of the asset. The company's segments are: Completion and Production, which delivers cementing, stimulation, intervention, pressure control, specialty chemicals, artificial lift and completion products and services; and Drilling and Evaluation, which provides field and reservoir modeling, drilling, evaluation and wellbore placement solutions that enable customers to model, measure, drill and optimize their well construction activities.
Northbridge Industrial Services is engaged in the sales and hire of industrial equipment on a global basis for use in applications in the oil and gas, shipping, construction, and power and utility sectors. Co. has two main reportable segments: Crestchic loadbanks and transformers, which is involved in the manufacture, hire and sale of loadbanks and transformers; and Tasman oil tools and loadcells, which is involved in the hire and sale of oil tools and loadcells.
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