Aegis Equities Research

Energy

Santos (STO) Fair value crimped by capex but trend to improving returns persists 13/06/2013 16:09
We reduce our Santos fair value estimate by 18% to AUD 14 per share after forecasting increased sustaining capital expenditure.... + more We reduce our Santos fair value estimate by 18% to AUD 14 per share after forecasting increased sustaining capital expenditure. At the current share price, our recommendation is downgraded to Hold. Including exploration expenditure, we project AUD 10.3 billion in all up capital expenditure for the five years to 2017. This includes AUD 4.3 billion on Gladstone and PNG LNG projects, which combined will increase group equity production by 60% to 85 million barrels of oil equivalent (mmboe) by 2017. - less

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Materials

BlueScope Steel (BSL) Asset sales positive but outlook still challenging 13/06/2013 14:13
We have taken a closer look at the Nippon Steel joint venture agreement. The deal saw BlueScope sell 50% of... + more We have taken a closer look at the Nippon Steel joint venture agreement. The deal saw BlueScope sell 50% of its Coated Products joint venture to Nippon Steel for USD 540 million in March 2013. The price paid equates to approximately 12 times EBITDA or 20 times EBIT, quite rich multiples and an attractive price to be selling. The concurrent high priced asset sale and debt repayment which cleans up the balance sheet is a tick for management. - less

Amcor (AMC) Courtesy of Currency Amcor's Earnings Defy Soft Conditions 12/06/2013 17:48
Since reporting a solid first half result and providing vague guidance for higher fiscal 2013 earnings, news flow from Amcor... + more Since reporting a solid first half result and providing vague guidance for higher fiscal 2013 earnings, news flow from Amcor has been non-existent. Global peers such as Bemis (BMS) and Sealed Air (SEE), as well as pallet provider Brambles (BXB) have since reported March quarter results and, as we expected, conditions have remained fairly subdued in developed markets. - less

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Industrials

Bradken (BKN) Strong headwinds will restrict growth 18/06/2013 08:58
We review our earnings forecasts, specifically re-evaluating the growth prospects of Bradken’s businesses with exposure to the resources sector.

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Consumer Discretionary

Seven West Media (SWM) Mining Downturn to Impact Newspaper Classifieds in West Australia 14/06/2013 09:33
The Fairfax investor day provided some colour on the current advertising market. They report a significant fall in comparable revenues... + more The Fairfax investor day provided some colour on the current advertising market. They report a significant fall in comparable revenues of up to 50% from employment advertising in regional areas reliant on the mining sector. We expect The West Australian, which accounts for 26% of group earnings, to report a weak comparable second fiscal half. - less

Fairfax Media (FXJ) Rearranging the Deck Chairs as the Ship Continues to Sink 12/06/2013 17:51
The current trading environment for Fairfax remains challenging with group revenue expected to be down 9 -10% for fiscal 2013.... + more The current trading environment for Fairfax remains challenging with group revenue expected to be down 9 -10% for fiscal 2013. Fairfax has accelerated the cost cutting program and expects to extract a further AUD 60 million in costs by September 2013. This takes the commitment to extract cost savings to AUD 311 million by fiscal year 2015. - less

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Australian Equity Strategy

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Consumer Staple

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