One for the future
DURING A lunch last week, CEO Fred Platt and CFO Chris Povall took me through their business model. One of the big concerns that many investors have regarding these smaller industrial companies is that they all talk about trying to emulate the Bidvest model but end up making expensive acquisition mistakes.
Platt was very blunt, admitting that they had made mistakes in the past but were now getting back to a position where they could grow the business sensibly and at their own pace while identifying opportunities in the infrastructure market. The board currently being assembled is of a high quality, and includes former Iliad chief Ralph Patmore.
The group has good BEE credentials, with Thebe Investment Corporation holding 18% of the shares. Also, management and staff are being given the message that share price appreciation will be where the real wealth is created in the long run, so stick it out. At a P/E of under 9 times and a promising infrastructure outlook, this might be worth a look