The case for being a bear re WOR, page-5

Let's summarise what 'figures' has posted.

In their FY15 yr end report WOR noted 105 'Significant Awards - represent contract awards that meet or exceed the anticipated EBIT earmings threshold. Yet during the same period WOR only announced only 17new contracts to the mkt. In FY16 figures were 85 and 7.

So far this FY firm has ann news of 3 contracts.

WOR plays around with words (see more posts re this topic soon) and uses 2 definitions. Betwween reports it announces 'significant contracts' which are contracts of a minimum size. True to form WOR never specifies what the minimum size actually is but in recent past smallest has been for CAD95m = about AUD95m. To say in the report 'significant awards' are those that exceeded anticipated earnings threshold could include contracts as small as 5-10m.

I'm convinced FY17 will see revenue continue to fall and first 6.6 months indicate my estimate is right. So it depends on how much margin/profit WOR can earn off a reduced revenue base. Engineering has never been more competitive so i expect margins to rise (due to savage cost cutting) but not nearly enough to justify a SP of almost $10.

Ask yrself: What is likely to give WOR's earnings a big boost over the next 6 months? I can't think of anything apart from a win or 2 in renewable energy.

SP flew this morn hitting $9.96 then faded in afternoon to close down 11c at $9.51. Massive intra day range.