AEM

AEM: Grp pays 0.35c dividend, looking for a better 2H13. AEM's results had no major surprises. The co reported a small net loss of $1.4mn following a provision of $2.6m for a sales rebate. Recall in Jul12, Siliconware Precision Industries invested US$20.5m in the Grp to upgrade its capabilities to better serve customers in the mobility space. The Group is in the process of qualifying these next generation substrates and performing trial production runs with several customers. Resulting from the launch of these new substrates programs the Group expects to see higher revenues in 2H13 vs 1H13. For the Group’s equipment business, the next generation program that are being developed with a major customer will still take a few more qtrs to reach the mass production stage. Current low volume units are being field tested at the customer’s production sites. As a result, the Group expects to see a gradual recovery in FY13." NRA Capital note that this is consistent with expectations that second half will be better and AEM remains an undervalued stock, and house top 3 Pickss, which is supported by its cash and NAV.