In today’s briefing:
- KNR: Trading at Cash with Proven Private Market Value
- China Oil & Gas – Earnings Flash – H1 FY 2024 Results – Lucror Analytics
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KNR: Trading at Cash with Proven Private Market Value
- Kontrol Technologies recently completed the sale of two subsidiaries for over $24M, allowing it to pay off all of its debt and reach a net cash position of $11.5M.
- KNR plans to reinvest the proceeds into organic growth, tuck-in acquisitions and stock buybacks.
- KNR operates in two secular growth markets, smart building technology and HVAC services, providing a backing for future organic growth.
China Oil & Gas – Earnings Flash – H1 FY 2024 Results – Lucror Analytics
China Oil & Gas (COG) has reported reasonable H1/24 results. Gross profit and EBITDA weakened slightly, mainly weighed down by lower earnings from residential connections amid the property market downturn. That said, there was slight earnings growth from the other business segments.
Leverage was broadly stable, supported by reduced capex. Liquidity was adequate, as the company drew down on its new USD 315 mn three-year syndicated loan and repaid the bridging facility. COG’s next meaningful debt maturity is in June 2026 (when the USD 300 mn notes will come due). We believe the company has options to address the bond repayment, considering its steady business operations and stable (albeit moderately weak) financial profile.