A dirt cleaner: bought BEL on this dip. I like the story (boring but big market) and the numbers. Found them when doing a screen.
Company: BEL
Date: 11/4/03
2003's expected earnings: $1.14
Estimated 5 yr. EPS growth rate: 15% (vs. estimate of 25%)
P/E maximum: 15
Graham Fair Value: $36.12
Current Price: $18.05
$ difference: $18.07
Percent Growth to Fair Value: 100.08%
Notes:
Excellent margins! Growing fast; no debt; $12.5 mil in cash
Excellent ROE, ROI, ROA; PEG of .85
Only 45 employees; CEO recognized leader in field
$46 mil sales through Sept vs. $31 mil FY02
EPS .75 vs. .46
Highlights of recent conference call:
- expect yearly EPS to meet or exceed target
- backlog of work around $270 mil (4 years of work or 400,000 tons)
- Quebec plant could add $1-2 EPS
- no else can do their volume; their plants are geographically close to their market; tend to win most large projects they bid on; lower costs than competition
- Notified they are being considered for Canadian index December 20; could add estimated 800,000 shares to volume
- rising Canadian dollar against US a concern; squeezes margins
Bennett Environmental Announces Q3 Results
Thursday, October 23
Revenues and Profits Significantly Increase From Prior Quarters
OAKVILLE, Ontario--(BUSINESS WIRE)--Oct. 23, 2003--Bennett Environmental Inc., a North American leader in the high temperature treatment of contaminated soils, announces Q3 revenue of $22,402,772 and net after tax profits of $6,796,616 or $0.39 per fully diluted share ($0.28 US). Compared to the same quarter last year, the Company more than doubled its revenues and nearly tripled its profits from $9,057,125 and $2,306,240 respectively as the Company's treatment facilities continue to increase capacity utilization. On a year to date basis, revenues of $47,822,472 have generated profit of $12,975,183 or $0.74 ($0.52 US) per fully diluted share. Demand for the Company's services remains high with good visibility on shipments well into next year. Construction on the new plant in Belledune, New Brunswick is underway and on schedule with full production expected by mid-year 2004.
The Company announced on September 9, 2003 that after a thorough and comprehensive review of its permit application, the Government of New Brunswick had approved construction of a new thermal oxidation soil treatment facility. The plant will be a key partner in the Renviro environmental industrial park located near Belledune in northeastern New Brunswick. The proposed facility will be capable of treating 100,000 tonnes of hydrocarbon and creosote impacted soil. It will use the same proprietary, state of the art technology, which has been safely and successfully employed for six years at Bennett's facility in Saint Ambroise, Quebec. Construction on the new plant is well underway and the foundations are nearing completion. Design and tendering for the equipment is progressing on schedule and the facility is on track for start-up and commissioning in Spring 2004. Following successful source testing, an operational permit and full production is expected by mid-year 2004.
Results of Operations
Bennett Environmental had a Q3 profit of $6,796,616 or $0.39 per fully diluted share versus a profit of $2,306,240 or $0.13 per share in the corresponding period last year. Revenues were $22,402,772 in the quarter versus $9,057,125 for Q3 2002. On a year to date basis, revenues of $47,822,472 have generated profit of $12,975,183 or $0.74 ($0.52 US) per fully diluted share. Compared to the first nine months of last year, revenues of $29,295,904 generated profit of $7,086,491 or $0.41 per share.
The Company's operating costs of $9,966,464 for the third quarter, were higher than the $3,889,954 for the same period last year and reflect the higher plant utilization in the quarter. In total, 23,000 tonnes of soil was processed in the quarter compared to 11,000 tonnes for the same period last year. So far nearly 52,000 tonnes have been thermally treated this year. Administrative and business development costs of $1,647,182 for the quarter were in line with $1,689,207 from the same period last year.
The Company's cash position has increased in the quarter by $1,967,262 to $12,472,444. Compared to the same period last year, cash reserves have increased by $2,913,271 from $9,559,173 at September 30, 2002. In the quarter, cash provided from Operations of $7,717,446 was offset by increases in working capital and investing activities. Receivables of $26,492,613 reflect a high level of $16,694,305 due from the Government of Canada as part of the negotiated payment schedule on the Saglek Labrador project. This amount will be paid over the next three quarters. The Company's net working capital position at September 30, 2003 has increased to $28,395,756 from the net working capital position of $18,206,207 at December 31, 2002. During the quarter the Company invested $1,695,832 in permitting and construction activities associated with the Belledune, New Brunswick plant.
About Bennett Environmental Inc.
Bennett Environmental Inc. is a North American leader in high temperature treatment services for the remediation of contaminated soil and has provided thermal solutions to contamination problems throughout Canada and the US. Bennett Environmental's proprietary technology provides for the safe, economical and permanent solution to contaminated soil. Independent testing has consistently proven that the technology operates well within the most stringent criteria in North America.
Bennett Environmental is listed on the Toronto Stock Exchange (Trading Symbol "BEV") and the American Stock Exchange (Trading Symbol "BEL"). |
