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Shaft Sinkers

October 2012

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • SHFT
  • Price:
  • 62p
Having rallied towards 90p the shares suffered another setback after Shaft Sinkers revealed poor first half results, with revenues 10% lower at £100m and pretax profit falling 76% to £1.7m, as gross margin collapsed from 17% to 10.5%. Eps was 1.6p versus 8.5p while net debt was £8.6m (H1 2011: net cash: £6.1m), although there was a £16.3m cash in-flow post period end. The shortfall reflected an absence of higher margin contracts and under performance of some South African contracts, notably Impala 16, due to logistical problems resulting in lower than expected ramp up of the mining development and shaft equipping contracts and Impala 17 because of long stoppages after a fatality. The other South African projects perfor ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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