AMO

[galumay]

Bought 31666 AMO at 30.5c on the 27/8/21

Decision journal here

Ambertech Limited, together with its subsidiaries, provides various technologies for the professional and consumer audio/visual markets in Australia and New Zealand. It operates through Professional, Lifestyle Entertainment, and New Zealand segments. The company distributes high technology equipment to professional broadcast, film, recording, and sound reinforcement industries; home theatre products to dealers; projection and display products for business and domestic applications; and custom installation components for home theatre, and commercial installations to dealers and consumers. Its home entertainment products include home cinema and theatre systems, Hi-Fi, and personal audio solutions; speakers, sound bars, and headphones; remote controls and antennas; and connectors, cables, and accessories. The company's professional performance equipment comprise live sound and video production solutions, music equipment, recording equipment and microphones, and video editing and post production systems. It also offers content creation, acquisition, deliver, processing, and asset management for broadcast and media in the areas of production systems, data management, video delivery, infrastructure hardware, cloud and IP video, post, remote operations, and workflow management. In addition, the company offers acoustic panels, amplifiers, audio preamps and matrix controllers, cameras, cases, guitars, hearing augmentation products, microphones, networking products, projectors, receivers, screens, sound level meters, speakers, speech transfer and tour guide systems, vocal and instrument processors, racks, studio and stage products, and audio video content players and recorders; and commercial and residential installation services. It operates through a network of dealers. The company was founded in 1987 and is based in Warriewood, Australia.

FY 2021 -



No quantitative outlook guidance at this stage.

My thesis is that at worst revenue will be maintained in the band around $80m, EPS of 6c & dividend will continue to be around 3c and that the share price will rerate to a price more in line with market valuations, my quick & dirty DCF gives a range of value around 80c and an implied return at purchase price of over 20%.

It will be a case of watching the financials very closely going forward to make sure the execution continues to add value for shareholders.

[galumay]

H1 2022. A steady half for AMO,



Divvy up to 3.1c so that will drive the SP up I expect.


FCF still positive despite loss of JK & going from tax write offs to paying tax. Result is actually stronger than the company narrative- quite understated.

[galumay]

A reasonably solid year for AMO, slight drop in revenue, earnings also impacted by increased tax liability, divvy essentially same as last year, havent gone thru in detail yet.

[galumay]

Disappointing H1 2023 for AMO, poor capital allocation as well with the dividend maintained and payed with borrowings. Negative OCF & FCF as well.

[galumay]

A strong 2nd half helped finish FY2023 on a high note. Rising expenses reduced net margins but a positive NPAT after the first half was a good outcome.  The problem shows in the cash flow though, negative OCF when right of use depreciation is backed out and once again its apparent the borrowings are paying the dividends. Poor capital allocation, should have suspended dividends rather than borrow to pay them. I think its time to sell.