AMA

1.49%

6.6¢ ama group limited

Ann: Appendix 4E and Annual Report-AMA.AX, page-40

First 40 Last

Share
Profile

Follow
madamswer

7,936 Posts.

1554

05/09/16

15:48

Post #: 18939282
Share

Originally posted by bensterz ↑

I pretty much agree with what you have said in this post.

The only item on which I would deviate from your comments (with the exception that maximum net debt to EBITDA might get to 2x) is on how long it would take to get to the terminal value point.

I don't think roll-up would be achieved in three years. I think the best case scenario would be five years at least but it will probably take longer. There are opportunities for AMA to get to the terminal point of around 200 shops but based on your figures this would require acquiring (based on a 63 shop footprint at Jun-16) 45 shops a year over 3 years or 27 shops in a five year scenario.

In a highly fragmented market there are fewer businesses which could bring a large number of shops in one transaction. Based on the other acquisitions made (outside Gemini) the businesses acquired have only brought in 3 shops on average. To maintain the same linear roll-up run-rate would require something like 10-15 businesses to be acquired each year for 3-5 years (or 5-7 businesses if they brought 6 shops in per business). I think the current SP, to a large extent, assumes this 3-5 year roll-up will happen but the IRR on an investment today would slip well into single digits if the roll-up takes 5+ years (especially if it requires the development of more greenfield sites for 'rapid repair' work and associated business ramp-up).

Your comments about the accounting/presentations hit a raw nerve with me. I think AMA engages in rather 'lazy' accounting and results presentations (which I have posted about in the past).

In FY17 alone they have kept at least $9m of EBITDA in their back pocket from full-year contributions still to come through from FY16 transactions. When AMA enters the ASX200 those sorts of games won't be accepted when more sophisticated investors enter the share register. Continuing to have a disconnected phone number and non-functioning email address for shareholder comms on their website (even after been told to update them) as well as failing to respond to shareholder correspondence (even just to acknowledge receipt of correspondence) annoys me as well.

Expand

@bensterz,

I hear you.

It's just that I have had considerable financial joy in the past supporting these sorts of industry consolidation plays (I am a long-term shareholder in dental practice aggregator, ONT), so I am naturally attracted to them.

Especially when they are at early stages, which AMA seems to me to be.

AMA Price at posting: $1.04 Sentiment: Hold Disclosure: Not Held
Upvote

0 Great analysis

Reply

Top Stories

DUI

Panic, paranoia, and gangland politics: HotCopper users react to Dubber's missing $26M

Week 47 Wrap: HotCopper users' most watched; Brent lifts on Putin's scary letter; RFK dents CSL

GRL

To make modern missiles, you need 3D Printing. And in that gold rush, Amaero is selling shovels

BTH

Bigtincan's Board backs Investcorp offer: Why a NASDAQ listing could be game-changing

HotCopper Highlights: Your most watched stocks for Week 47, 2024

WC8

Pan Asia rebranding to 'clear confusion' after bagging $35M for Chile projects

LPE

Sales growth pushes Lovisa's fortunes (and shares) upwards

MIN

MinRes's Ellison knows he screwed up – for that reason, hunt for new Chair to be sped up

PYC

Scientific conference spotlights PYC's work on blindness disease treatment

SIG

Dale Gillham's weekly wrap: Sigma-Chemist Warehouse merger creates pharma powerhouse

There are more pages in this discussion • 3 more messages in this thread...

First 40 Last

Add AMA (ASX) to my watchlist

(20min delay)
Last 6.6¢		Change -0.001(1.49%)		Mkt cap ! $286.9M

Open	High	Low	Value	Volume
6.4¢	6.7¢	6.4¢	$214.0K	3.275M

Buyers (Bids)

No.	Vol.	Price($)
4	145752	6.4¢

Sellers (Offers)

Price($)	Vol.	No.
6.6¢	154026	1

View Market Depth

No.	Vol.	Price($)
4	59761	1.050
3	2596	1.045
3	3726	1.040
2	2898	1.035
1	50000	1.030

Price($)	Vol.	No.
1.055	77023	3
1.060	53603	4
1.065	51503	3
1.070	2503	1
1.080	1158	1

Last trade - 16.10pm 22/11/2024 (20 minute delay)

AMA (ASX) Chart

Ann: Appendix 4E and Annual Report-AMA.AX, page-40

Panic, paranoia, and gangland politics: HotCopper users react to Dubber's missing $26M

Week 47 Wrap: HotCopper users' most watched; Brent lifts on Putin's scary letter; RFK dents CSL

To make modern missiles, you need 3D Printing. And in that gold rush, Amaero is selling shovels

Bigtincan's Board backs Investcorp offer: Why a NASDAQ listing could be game-changing

HotCopper Highlights: Your most watched stocks for Week 47, 2024

Pan Asia rebranding to 'clear confusion' after bagging $35M for Chile projects

Sales growth pushes Lovisa's fortunes (and shares) upwards

MinRes's Ellison knows he screwed up – for that reason, hunt for new Chair to be sped up

Scientific conference spotlights PYC's work on blindness disease treatment

Dale Gillham's weekly wrap: Sigma-Chemist Warehouse merger creates pharma powerhouse

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News

Ann: Appendix 4E and Annual Report-AMA.AX, page-40

Top Stories

Panic, paranoia, and gangland politics: HotCopper users react to Dubber's missing $26M

Week 47 Wrap: HotCopper users' most watched; Brent lifts on Putin's scary letter; RFK dents CSL

To make modern missiles, you need 3D Printing. And in that gold rush, Amaero is selling shovels

Bigtincan's Board backs Investcorp offer: Why a NASDAQ listing could be game-changing

HotCopper Highlights: Your most watched stocks for Week 47, 2024

Pan Asia rebranding to 'clear confusion' after bagging $35M for Chile projects

Sales growth pushes Lovisa's fortunes (and shares) upwards

MinRes's Ellison knows he screwed up – for that reason, hunt for new Chair to be sped up

Scientific conference spotlights PYC's work on blindness disease treatment

Dale Gillham's weekly wrap: Sigma-Chemist Warehouse merger creates pharma powerhouse

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News