Now that we all know what the prospects for MOS are i.e. damn good, thought I'd get a new thread going and just highlight MOS' attractions for any new investors.

Key highlights:

* Significant progress made, rationalisation programme almost complete

* Acquisitions integrated well

* International marketing network established

* Record order books, enquiry levels high, several new customers won

* Recent Director buys

From the Chairman's statement:

Outlook

Over the past year the management team has extended the product range, put in
place in-house manufacturing, rationalised the existing business and greatly
expanded the marketing effort, opening up significant new markets to MOS
products. Once the acquisitions have been fully integrated MOS will offer a
wider product range to a broader market and have a much reduced cost base. We
have record order books, we have attracted major new customers and we are
targeting new markets, worldwide. Overall, we have made good progress and the
outlook remains extremely positive.

Trading Update

MOS International PLC ('MOS'), the oilfield services company, announces that
trading is in line with market expectations. TURNOVER FOR THE YEAR TO 31st MARCH 2005 IS EXPECTED TO BE CIRCA 10M COMPARED WITH 1.05M IN THE YEAR TO 31st MARCH 2004.

MOS currently has an order book in excess of 7m for delivery prior to the year
end.

The recent acquisitions have integrated well, the rationalisation programme at
MOS is almost complete and that at Ansell Jones will be completed in this
financial year.

Tender and enquiry levels remain high and the Board is positive regarding the
future. Significant progress has been made and the business is well on the road
to recovery, with turnover forecast to show a further considerable increase, in
the next financial year.

On a turnover of 10million with a profit of say 1million, this company is on a P/E ratio of just 8 (market cap being around 8million at present). This company has been overlooked by the institutions and investors alike and is due a big re-rating soon IMHO. DYOR as usual.

Chad.

Yes but outlook and potential should also be factored in.

Even if there is only a small profit for 04/05 as long as order books are high and outlook is good that's what really matters. They are already saying that they expect t/o for 05/06 will be inexcess of 15mil and as soon as they confirm that that is the case then the sp will rise. People will see that MOS do not pluck figures out of the air but they base their figures on strong enquires and contract wins.

Good to read all the recent postings after being out today - thanx all. Re P/e, maybe I cann help us out a bit here?
Not sure its a fair comparison but if we take Abbot (ABG)- the leaders for sector & Expro (EXR), then some comparisons are as follows (source IC financials pages- latest available info):
Year T/o Pre-prof. P/E
ABG
2001 264M 10.16M 34.1
2004 366M 21.92M 19.2

EXR
2001 172M 16M 21
2005 211M 11M 24

Haven't looked at ALL the 'competitors' so admit to being selective, and IC did reckon ABG have expensive P/E- still a buy (article end May issue) - but it gives an idea for the sector.

I have to share Chrissie's view here - a P/E of 12 is not unreasonable. Given that last year on a t/o of 1.3M MOS made a gross PROFIT of 653k (notwithstanding rationalisation costs which produced the net loss of 0.39M), then IF t/o was 10M for y/e 31/3/04, the profit ....is quite large - better than last 3 years put together. Remember the 980k rationalisation cost incurred won't be seen again - even if it was MOS is still in profit. The issue is the share placings which will have diluted EPS. How much - we don't yet know. Looking at ABG's profit of 21.92M- MOS are not that far behind even though their t/o is far less e.g. IF costs stayed same as now, and 15M t/o was hit, profit could be 13M+ next year (2006) - small is beautiful.

ptholden - can you calculate based on this, & your view of outstanding shares what a reasonable sp might be ala ABG et al? I'm not too hot on sp calculations. 3p target is simply based on continuing as now - i.e. no extra costs, same average orders, linear rate of revenue increase of ~5M py...

We really need the results to settle things ...2 months max to go... :)

Owl

Playing around with a few figures.

MOI have historically operated on a gross margin of roughly 40%. However, the aquisition of Ansell (in July) which is expected to contribute 4M operates on a margin of 10%.

If we assume that the turnover for 2004-05 will be 10M then the gross profit should be in the region of 3.1M.

7M x 40% = 2.8M +
3M x 10% = 300K (Ansell from July)

The recurring expenses for the rationalisation programme were expected to continue into the second half of the year, and I assume that these costs were included in the Administrative Costs for the first half (1.4M). I would also expect that with the recent acquisitions the Admin expenses will grow, although I have no idea by how much. So, it's take a guess time, what will the admin costs be?

Admin costs of 2M = Profit of 1.1M PE(12) = SP 1.2p PE(24) = SP 2.4p
Admin costs of 2.5M = Profit of 600k PE(12) = SP 0.63 PE(24) = SP 1.28p

The other question, of course, is have MOI had to 'buy' sales to secure turnover, ie, reduced profit margins?

All very much conjecture until the results are published and we can see where the company is going.

pth

pth
Thanks for your brains on this.
Noticed director of Expro bought yesterday - sector news still extremely +ve.
Feathered a few more @ .63p...
Back to zzzzzzz in the sun...

Chrissie, as you imply re. the PR crowd " they would say that wouldn`t they",
I can only repeat my feeling that 1p would be an excellent price after the results-from 0.62p is +50%.
I personally think that the sub 1p price is crazy, and that a consolidation to 62p would be appropriate, then think of a co. whose share price jumped from 62p- a penny share even so - into one at or over 100p, much more headline grabbing.

Just noticed a mistake in my turnover calculations which has reduced the 'predicted' SP, have edited the post.

pth

Source: Rigzone.com
United Press International Tuesday, June 07, 2005


Next month's Scottish summit of leaders from the wealthy Group of Eight nations will likely result in proposed tax breaks to encourage new refining capacity.

Part of this year's increase in energy prices has been laid at the feet of a global shortage of refining capacity. Leaders of G8 nations have been discussing ways to stimulate major oil companies to invest the billions of dollars required for new refineries, the Financial Times reported Tuesday.

Among those calling for more refining capacity is the International Energy Agency, which blames weak refining capacity on this year's nominally high crude oil and petroleum product prices.

Various tax-based incentives for boosting refining capacity are expected to be discussed at the G8 summit in Edinburgh July 6-7.

ptholden

Thanks for making things clear, we'll just have to wait and see now.

The Owl
Did Incestors Chronicle cover AIM shares today? If so, how did we do?

chrissie

Problem with very small SPs is the temptation to believe that it is easy to go from say 0.5p to 3.0p, afterall it is only 2.5p, when in fact it is the same as a stock leaping from 1 to 6. However, these small shares can gather significant momentum that throw fundamentals directly out of the window. Personally, I quite like the look of MOI, but will wait for the results to see how they are keeping on top of costs and at what margins these acquisitions are trading at. Also think there are to many shares in issue, though am aware consolidation has been spoken of before on this thread.

pth

Hi Chrissie,
usually get IC lunchtime Friday - should be interesting!

I know it's the same in theory for a share to go from .60p to 3p as 1 to 6 but it seems much more likely and common for a penny share to double, treble etc. very very quickly. At the moment I don't think that everything is factored into the sp. but like I said we'll see.

I look forward to seeing your analysis of the results.

Thanks Owl...fingers crossed then!

...fingers, legs, feathers - in fact everything crossed I think!!
Don't really want to buy too many more, or I'll become a mini-hedge (or nest!) fund.

chrissie,

Just re-read my post, sounds awfully patronising, so apologies, wasn't trying to teach you to suck eggs, just stating the blindingly obvious!!

It would be interesting to know exactly how the stats breakdown with regard to SPs doubling. How many from sub 1p to 1p, 1p - 2p etc etc.

pth

ptholden

No, I honestly didn't think that you were being patronising.

Your posts are helpful and you know much more about calculating a sp than I do and possibly many others reading the posts. It's just that when you've come to your fact based sp then I add a little for potential growth, outlook, full order books, director buying, aquisitions working out well, cost cutting etc etc. Oh and I do think that Phillip Woods is doing an excellent job and has made some very hard decisions for the good of the company and it's shareholders. Maybe MOS website and PR need inproving but otherwise it's all good in my opinion.

And I really am looking forward to reading your analysis of the results. It really is good to have someone on the board who just looks at the bottom line (turnover and profit) it keeps all our feet on the ground and it's good for newcomers to the share to see a balanced view.

Be great if we do get a good write up in IC tomorrow. Good luck to us all.

Well, IC seem to have overlooked MOI in the AIM 1000 which covers '...all companies on AIM...' No matter though. Pg 46 'In April 2005, the global rig total according to consultants Baker Hughes (and excluding Russia & Onshore China) was 2415 up from 2136 - a 13% rise. Activity levels are up and, in spite of ups & downs, The Aim oil & gas sector is only going to get bigger'. This squares with a piece on Bloomberg by Halliburton yesterday re not being enough exploration facilities for UK. No reason to sell. Back to waiting for results I'm afraid.

Thought another call to our friends, Bankside would be worthwhile.
There are more positives to be announced which we don't know about yet ...it really does seem like all parts of the business are doing well. Qu is what do we do between now & August time when results come out? Sit tight I guess...

I can't believe IC left Mos Int out, especially as they gave them such a good write up before. We should all complain!

I'm not complaining, since I took the opportunity to add a little at 59.5p today. All the circumstantial news is good. A nice little series of RNS one after the other would be good now now I'm up to quota.

sd

FWIW, I've been in MOI a while; not best timing by any means, but the fundamentals look OK to me, so I'm sticking with it.