Bullish Sign? - Bounced off 200 EMA, page-2624

You wrote, "I'm turning into an Oliver Twist....can I have more?" I have turned into a Mr Micawber - something will turn up.

Does anyone know if the Eliwana Bridge Contractor work package has been awarded to anyone yet? The EOI (expression of interest) closed on 17 September 2018, and the Target Award Date was January 2019.Two interesting conditions were specified:

• Supplier must be able to demonstrate they have completed a similar Project in the Pilbara region.
• Under the National Prequalification System administered by Main Roads WA- B4 capability and F50 financial are required by the Bridge Contractor.

The B4 capability is the highest level for bridge building. The F50 simply means that the supplier must be deemed OK for projects valued up to $50 million. Golding Services has the highest National Prequalification possible – (R5 for road construction, B4 for bridge construction, and an F150+ financial rating). If FMG wanted to award the contract to NWH, it could do so, which is why I emphasised the separation of the above two sentences via dot points, because Golding as such has probably not worked in the Pilbara, but that need not be a showstopper.

I am not specifically interested in the Eliwana Bridge Contractor work package – I just selected it as an example of tenders still in the pipeline. The Eliwana Concrete Batch Plant work package EOI closes this month, and its Target Award Date is April 2019. The Construction of Bulk Earthworks package''s EOI closes on 1 February 2019, and its Target Award Date is May. The recently-announced win of a $57m earthworks contract related to the Eliwana rail extension. There are other Eliwana packages up for grabs, but I have written enough about Eliwana to suggest there are more contracts to win.

If one poked about, one would find other projects from which NWH could win contracts in calendar year 2019. The danger of committing to too much work, and hence needing to boost CAPEX and hire people too quickly, is greater than the danger of not securing enough work, IMO. This is why I am now disinclined to take a bottom-up revenue forecasting approach for the next three or more years, in favour of simply selecting a conservative revenue trajectory, at good margins. Collectively dreaming up what contracts will flow from the RCR acquisition is like debating how many angels can dance on the head of a pin, which is not where our serious focus should be.