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STEFANUTTI STCK HLDGS LTDSTEFANUTTI STCK HLDGS LTDSTEFANUTTI STCK HLDGS LTD

STEFANUTTI STCK HLDGS LTD

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SSK trade ideas

Our opinion on the current state of STEFSTOCK(SSK)Stefanutti (SSK) is a South African construction company which offers roads and earthworks, marine construction, concrete structures, bulk pipelines, piling, geotechnical services, open pit contract mining, affordable housing, mine residue disposal, and other services. It operates in sub-Saharan Africa and the United Arab Emirates (UAE). The company is considering further down-sizing to match its falling order book, and this will mean retrenchments. The share price has fallen from its high of 2650c in November 2007 to current levels around 56c. The company is not paying dividends. Construction is always a risky investment in South Africa. Much will depend on the progress of the South African economy and the availability of construction work from the government. This share is probably going to continue its long-term downward trend for the foreseeable future. We consider it to be a poor investment even as a speculation. In July 2020, Stefanutti was accused by Eskom of being overpaid R1bn for work done on Kusile - which the company denies. In a restructuring plan, the company is selling non-core assets and plant and equipment and trying to obtain further funding of R430m to counter the impact of COVID-19. The company is engaging in a restructuring plan which involves the sale of non-core assets, securing additional short-term funding of R430m, and cutting costs. The company is technically insolvent, and we think that this company may well be following many of its peers in the construction industry into consolidation or business rescue if the current restructuring does not work. In its results for the six months to 31st August 2024, the company reported revenue up 2% and headline earnings per share (HEPS) of 13,23c compared with a loss of 22,41c in the previous period. The company said, "Capital repayments of R13 million and R37 million were made in March 2024 and July 2024 respectively, reducing the loan to R947 million. The loan bears interest at prime plus 3,7%." Technically, the share entered a new upward trend in June 2024 and was added to the Winning Shares List (WSL) on 22-6-24 at 146c. It has subsequently risen to 467c.
JSE:SSK
by PDSnetSA
Our opinion on the current state of STEFSTOCK(SSK)Stefanutti (SSK) is a South African construction company offering services in roads and earthworks, marine construction, concrete structures, bulk pipelines, piling, geotechnical services, open pit contract mining, affordable housing, mine residue disposal, and other areas. It operates in sub-Saharan Africa and the United Arab Emirates (UAE). The company is considering further downsizing to match its falling order book, which will mean retrenchments. The share price has fallen from its high of 2650c in November of 2007 to current levels around 56c. The company is not paying dividends. Construction is always a risky investment in South Africa. Much will depend on the progress of the South African economy and the availability of construction work from the government. This share is probably going to continue its long-term downward trend for the foreseeable future. We consider it to be a poor investment even as a speculation. In July 2020, Stefanutti was accused by Eskom of being overpaid R1bn for work done on Kusile, which the company denies. In a restructuring plan, the company is selling non-core assets and plant and equipment and trying to obtain further funding of R430m to counter the impact of COVID-19. The company is engaging in a restructuring plan which involves the sale of non-core assets, securing additional short-term funding of R430m, and cutting costs. The company is technically insolvent, and we think that this company may well follow many of its peers in the construction industry into consolidation or business rescue if the current restructuring does not work. In its results for the year to 29th February 2024, the company reported revenue up 17% and a headline loss per share of 55.73c compared with a loss of 38.73c in the previous period. The company said, "...at 29 February 2024 the group's current liabilities exceeded its current assets by R1,136 million (Feb 2023: R1,141 million), and the group's total liabilities exceed its total assets by R52 million (Feb 2023: R66 million)." The company's shares have become a "penny stock" and it remains a highly risky loss-making business.
JSE:SSK
by PDSnetSA
Our opinion on the current state of STEFSTOCK(SSK)Stefanutti Stocks (SSK) is a South African construction company that has long been a player in both the local and international markets, including sub-Saharan Africa and the United Arab Emirates (UAE). The company offers a broad range of services, including roads and earthworks, marine construction, concrete structures, and more. Despite its diverse service offerings, Stefanutti faces significant challenges that cast a shadow over its investment potential. The construction industry in South Africa is notoriously volatile, heavily dependent on economic conditions and government projects. Stefanutti's share price reflects this instability, having plummeted from a high of 2650c in November 2007 to about 56c currently, without any dividends being paid to shareholders. This decline is indicative of the broader struggles within the sector and the company's specific operational challenges. Stefanutti has been implicated in controversies, such as the accusation by Eskom in July 2020 of being overpaid R1 billion for work on the Kusile power plant, a claim the company denies. These issues further complicate its public and financial profile. Amidst falling order books, the company is undergoing a significant downsizing effort, which includes retrenchments and a restructuring plan aimed at financial recovery. This plan involves selling non-core assets and plant equipment and attempting to secure an additional R430 million in funding to mitigate the impacts of COVID-19. The company's efforts to divest from non-essential operations and assets are crucial for its survival but signal deep-seated financial troubles. For the six months ending on 31st August 2023, Stefanutti reported a 16% increase in contract revenue but still recorded a headline loss of 22.4c per share, showing some improvement from a 25.0c loss in the previous period. These results highlight ongoing struggles despite some gains in revenue. Looking forward, the company provided a trading statement for the year ending 29th February 2024, predicting a further deepening of losses to between 52.29c and 60.03c per share. This forecast underscores the dire financial straits in which the company finds itself. The management's disposal program aims to offload certain operations, classifying them as discontinued in anticipation of their sale within the next 12 months. Recent share price movements suggest a mild resurgence in investor interest, possibly linked to advancements in the negotiation to sell its 49% stake in Al Tayer Stocks (ATS). However, Stefanutti remains a high-risk investment, teetering on the brink of insolvency. Potential investors should be wary, as the company could follow the unfortunate path of many peers towards consolidation or business rescue if current restructuring efforts fail to stabilize its financial position. This background positions Stefanutti Stocks as a less favorable investment, particularly for those averse to high risk.
JSE:SSK
by PDSnetSA
Our opinion on the current state of SSKStefanutti (SSK) is a South African construction company which offers roads and earthworks, marine construction, concrete structures, bulk pipelines, piling, geotechnical services, open pit contract mining, affordable housing, mine residue disposal, and other services. It operates in sub-Saharan Africa and the United Arab Emirates (UAE). The company is considering further down-sizing to match its falling order book, and this will mean retrenchments. The share price has fallen from its high of 2650c in November of 2007 to current levels around 56c. The company is not paying dividends. Construction is always a risky investment in South Africa. Much will depend on the progress of the South African economy and the availability of construction work from the government. This share is probably going to continue its long-term downward trend for the foreseeable future. We consider it to be a poor investment even as a speculation. In July 2020 Stefanutti was accused by Eskom of being overpaid R1bn for work done on Kusile - which the company denies. In a restructuring plan the company is selling non-core assets and plant and equipment and trying to obtain further funding of R430m to counter the impact of COVID-19. The company is engaging in a restructuring plan which involves the sale of non-core assets, securing additional short-term funding of R430m and cutting costs. The company is technically insolvent, and we think that this company may well be following many of its peers in the construction industry into consolidation or business rescue if the current restructuring does not work. In its results for the six months to 31st August 2023 the company reported contract revenue up 16% and a headline loss of 22,4c per share compared with a loss of 25,0c in the previous period. The company is trying to reduce debt by "...the sale of non-core assets - the sale of underutilised plant and equipment and the sale of identified operations". The company's shares have been rising recently as its negotiations to sell its 49% of Al Tayer Stocks (ATS) have progressed, but it remains highly risky.
JSE:SSK
by PDSnetSA
Our opinion on the current state of SSKStefanutti (SSK) is a South African construction company which offers roads and earthworks, marine construction, concrete structures, bulk pipelines, piling, geotechnical services, open pit contract mining, affordable housing, mine residue disposal, and other services. It operates in sub-Saharan Africa and the United Arab Emirates (UAE). The company is considering further down-sizing to match its falling order book, and this will mean retrenchments. The share price has fallen from its high of 2650c in November of 2007 to current levels around 56c. The company is not paying dividends. Construction is always a risky investment in South Africa. Much will depend on the progress of the South African economy and the availability of construction work from the government. This share is probably going to continue its long-term downward trend for the foreseeable future. We consider it to be a poor investment even as a speculation. In July 2020 Stefanutti was accused by Eskom of being overpaid R1bn for work done on Kusile - which the company denies. In a restructuring plan the company is selling non-core assets and plant and equipment and trying to obtain further funding of R430m to counter the impact of COVID-19. The company is engaging in a restructuring plan which involves the sale of non-core assets, securing additional short-term funding of R430m and cutting costs. The company is technically insolvent, and we think that this company may well be following many of its peers in the construction industry into consolidation or business rescue if the current restructuring does not work. In its results for the year to 28th February 2023 the company reported revenue flat and a headline loss per share of 38,73c compared with a loss of 97,07c in the previous year. The company's restructuring plan includes, "...the sale of non-core assets; - the sale of underutilised plant and equipment; - the sale of identified operations; - a favourable outcome from the processes relating to the contractual claims and compensation events on certain projects; and - evaluation of the capital structure including the potential of raising new equity". In a trading statement for the six months to 31st August 2023 the company estimated that it would make a headline loss of between 5,07c and 10,13c compared with a loss of 25,33c in the previous period. The company's shares have been rising recently as its negotiations to sell its 49% of Al Tayer Stocks (ATS) have progressed, but it remains highly risky.
JSE:SSK
by PDSnetSA