08 April 2020
By Maynard Paton
Results summary for Mincon (MCON):
- A rather muddled and subdued update, the highlight of which during the present Covid-19 uncertainty was a maintained dividend.
- Impairments, exceptionals, accounting quirks and profit diving 28% may all be forgiven if, as seems to be the case, operations have not been too affected by the pandemic.
- An emphasis on “geotechnical” drills and lack of “challenger model” references imply new priorities as the business remains in a ‘moat-digging’ phase.
- Appealing management remarks about product quality, patents and future innovation have yet to make any impact on the somewhat messy financials.
- A post-results acquisition leaves the business with net debt while the underlying P/E of 16 is not an obvious bargain. I continue to hold.