The normalised EBITDA earnings downgrade from $25-28m to $21-23m detracts from an otherwise impressive execution of strategy. With the sale of the capital-intensive Chilean cranes substantially complete, the business has been significantly derisked and we expect improving returns on assets in future years. However, investors understandably will be focused on near term earnings given this miss, and our blended valuation of $0.220 (prior $0.265) is weighted towards earnings capitalisation as a result. Nevertheless, it is still more than 20% ahead of the current share price and we maintain a BUY recommendation. Positive catalysts are hard to see in the short-term, however we are supportive of strategic initiatives and are comforted by the significantly improved balance sheet.
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