Ann: Preliminary Final Report (App 4E) year ended 31.3.17, page-9

@Ashentegra ,

The reason I maintain a watching brief over this business is because, at one stage of my investing life, ALS was one of the most profitable investments I had ever made.
So I have a bit of a "soft spot" for the stock.

(In truth, when I audit the causality of my success, it was mostly luck because I happened to ride the entire commodity boom wave, and no one could have predicted that.)

As a shareholder since 2002, I watched the company's acquisition foray over the next few years with a bit of trepidation, all the while benefiting from the commodity boom, which was masking management's spending habits.

In 2010, after ALS increased its offer for another listed company, Ammtec, no less than twice over a relatively short time frame (from 335c to 380c to 408c in the matter of weeks) - to end up effectively paying a huge P/E multiple of ~23x for the business (at what surely had to be a point close to the top of the cycle, I thought) - my patience had run out and I sold all my shares.

The share price continued rising thereafter, but when I saw them in 2013 buy that dog of a business, Reservoir Group, I felt vindicated in selling. The rest is history.

Like you, I sense, this is a business that I would like to own again at some stage, because of its strong free cash flow generation.

But I would first like to have faith in stewardship of those Free Cash Flows, and that they are not going to be splashed around like drunken sailors on another acquisition spree.

And there is nothing that the company is saying or doing that provides me with the sort of assurance I'm looking for.

In the meantime, I fully expect the stock to continue going up, as the cyclical rebound junkies hop on board.