Civmec

Civmec has announced a series of contracts worth $65m.The contracts include the following: - Nammuldi Below Water Table (NBWT) project for Rio Tinto; - Civil contract for the construction of a air gas liquefaction plant for BOC; - The supply of precast sleepers for the Nammuldi Below Water table (NBWT) project for Crushing Services International; and - The supply and erection of structural steel for the upgrade of concrete plants in the Perth region for Holcim (Australia). The latest contracts bring the group’s total orderbook to ~$390m and stretches earnings visibility to slightly over a year. Despite the apparent slowdown in the Australian resource boom, Civmec’s management has asserted that capital expenditure in resource projects remains buoyant and the group is maintaining high levels of tendering activities, which has resulted in the award of several new contracts. At the current price, Civmec trades at an annualized 12x FY14 P/E and 3.1x P/B. There is very little coverage on this stock.