Ann: Trading Halt, page-30

I got the “sustaining iron ore tonnage” theme right, and the customer wrong in my earlier post today. It did cross my mind that it could be BHP, because I based my gut-feel on the RIO-style language used by NWH, but as I added in my 34031619 post of 29/06/2018, “. . . BHP tends to use similar language.”

The two cherries on the cake are that: a) the BHP work will commence soon, and favourably impact FY18 and FY19; and b) the contract is with BHP, which leaves the potential open to also land a RIO contract soon. Getting the concrete-footing work for the conveyor belts is a plus – something NWH missed out on at Silvergrass, unless they obtained that work without fanfare via a subcontract.

I am looking forward to the day when I can, with conviction, move my target price above $2.00.

PS: Those who think that new contracts means better cash flow, and hence dividends in the short term, should think again. This type of company is like a heat sink that absorbs heat (cash) when things are heating up, and emits heat when slowdowns require little CAPEX.