Growth momentum continues unabated
We have upgraded estimates (again) to reflect this, with rental markets particularly buoyant which should result in Crestchic delivering record profitability levels in FY22 with adj. EPS estimates now 37% higher.The purchase and the subsequent refurbishment of used equipment is enabling Crestchic to meet rising rental demand. Utilisation rates are at record levels and new project demand stretches into FY23. Combine that with price increases plus strong performance in all sectors, and you have the background to the current virtuous circle.
Contracts have also been agreed for the disposal of the remaining portion of the Tasman oil tools business in the Middle East. The purchaser has paid a deposit and completion should occur within weeks, once the local regulatory approvals are forthcoming.
The upgrades feed through to a large increase in our fair value calculation (based on a DCF and peer group comparison). Now at 283p/share (up from 249p) that represents a material premium to the current price.
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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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