HDX 0.00% $2.80 hughes drilling limited

Happy to talk to someone who has done some research into the...

  1. 57 Posts.
    Happy to talk to someone who has done some research into the sector at least.

    Riechdrill is indeed just an asset, but the company has credit lines offered to them by Watpac if i'm not mistaken. Or at least in the past they had.

    The drilling companies you listed were all focused on exploration/delineation drilling and a little of coal seam gas.
    I agree with the fact that it is hard to know what 70 million in equity is worth in the current market.
    The Tom Browne drilling assets had a book value of 45-50 million and were bought for 10 or so.
    But blast hole rigs should be a bit more valuable given they are less susceptible to a downturn compared to exploration rigs.
    Tom Browne should also be a somewhat familiar name to HDX holders since HDX had sold a delineation rig to them in 2014 but never recovered the full amount when it went into administration..

    The reason for the high amount of inventory is I guess due to Reichdrill and Express Hydraulics. They need a high amount of spare parts for quick deliveries when needed. Again a bad move to take on such a large amount of debt to finance inventory, especially since the margin on sales are very small to non-existent when you look at the segment results in the financial reports.

    I get the same feeling that it won't end well.

    It's a pity because I assume the company is still profitable, but over-extended itself.
 
watchlist Created with Sketch. Add HDX (ASX) to my watchlist

Currently unlisted public company.

arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.