Maritime and offshore waste collection and treatment company Nature Group (NGR) has had a tough time of things, with facilities in Gibraltar still out of action after an explosion, while shipping volumes in Rotterdam have been depressed. This has proved a major drag on the share price, but there are reasons to believe that there is scope for recovery.
The potential game changer remains the containerised treatment unit (CTU) that is exclusive to Nature Group, and enables waste sludge to be processed on board an oil rig, eliminating the need for costly transportation to a port with a processing facility. Two more were completed in June, and the market potential is considerable, with nearly 800 rigs in operation around the world.
There has been encouraging progress on the Gibraltar installation where Nature Group has been given permission to undertake preparatory repair work. This is important because illegal waste disposal at sea in the Mediterranean is commonplace, but with environmental global compliance set to increase the business can expect to see a marked increase in demand.
WH Ireland is forecasting full-year pre-tax profits of £3m and EPS of 3.1p, rising to £4.5m and 4.6p, respectively, in 2013 (2011: £2.2m and 2.3p).
| NATURE GROUP (NGR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 28p | MARKET VALUE: | £22m | |
| TOUCH: | 26-30p | 12-MONTH HIGH: | 70p | LOW: 24p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 35p* | NET CASH: | £1.23m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 8.38 | 2.03 | 2.43 | 0.50 |
| 2012 | 8.08 | 1.01 | 1.18 | nil |
| % change | -4 | -50 | -52 | -100 |
*includes intangible assets of £13.3m, or 17p a share | ||||
