New guidance suggests FY19 revenue of $1.9b, well up on the prior $1.3-1.4b, and 1H19 EBIT of $39-41m. This is a near term positive, but the longer term implications is the key takeaway in our view; procurement activities on the back of a number of recent awards demonstrate the medium term workload and endorse ASB’s capability, while we would expect margins on vessel programmes and individual builds to pick up over time. Our valuation climbs to $2.45 (prior $2.30) on earnings upgrades and we maintain a BUY call.
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