Updates

Capital Limited

June 2023

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

Capital’s first quarter was slightly better than forecast with revenues of US$77.8m, down 1.6% on last quarter. The refocusing of its fleet towards larger-scale mining services contract work has pleasingly lifted ARPOR (average revenue per operating rig) to US$192,000 from US$191,000 in Q4 ‘22 and US$180,000 in FY’22. Average fleet utilisation was 77%, ahead of forecast, but partly reflecting a temporary drop in fleet size (123 versus 129 in Q4 ‘22) as old rigs were decommissioned before new ones arrived. Four contracts (including extensions) were won in the quarter. Overall, forecasts are unchanged (eps: 17.9 cents and 19.7 cents for FY’23 and ‘24) with Peel Hunt reiterating its 147p price target and Berenberg 166p. I ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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