Conduril releases 2022 annual results

I have been a shareholder of Conduril for over a decade now, but unfortunately, it hasn’t been a real successful investment so far. I bought my initial stake at €22/share and the stock is currently trading marginally higher at €26.20/share. Although there have been some dividends along the way, they haven’t been enough to compensate for the opportunity cost of holding this position. I believe in buying cheap companies without a catalyst, having faith that something will eventually happen to unlock the value that is there. But assuming I’m right about the value being there in there first place (a big if!), there is still no guarantee that something will happen.

With a more than 10 year holding period I think you can make a good case for throwing the proverbial towel in the ring, but I’m not quite ready to do that. Conduril is still cheap, trading at a 62% discount to NCAV, a 0.20x P/B-ratio and a 5.86x P/E-ratio, but there are also some signs of change on the horizon. In 2022 the company bought back, for the first time in its existence, 10% of the outstanding shares. Given the price the stock trades at I think this is quite accretive to intrinsic value (sadly there is no plan to continue the buybacks this year). Secondly, the chairman of the board recently passed away. He was a major shareholder of the company with a 28.60% ownership stake, and a large transition in the ownership of the company could potentially pave the way for some (hopefully positive) change.

The results for 2022 itself look promising, with earning per share at €4.47, the highest it’s been in the past 8 years. The order backlog is at a healthy level as well, slightly higher than the previous year, and it appears that some of the financial assets on the balance sheet (Angolan government bonds) have been converted to cash. According to the footnotes of the financial statements the remaining bonds have maturity dates in 2023, 2024 and 2026. The majority only matures in 2026, so some patience may be required. Fortunately, I’m a patient investor…


Author is long Conduril

7 thoughts on “Conduril releases 2022 annual results

  1. writser

    “ I think you can make a good case for throwing the proverbial towel in the ring, but I’m not quite ready to do that.”

    There’s also nobody willing to pick up the towel :p

  2. JG

    Hey AV,

    Any idea why we got a 10 for 9 split on the 12th?.. We are now basically back to 1.8M shares outstanding… See no messages on the company website, and to be honest, I have not yet reached out to the company.

  3. JG

    I saw the notice on Euronext – it basically says they issued 200K shares as bonus shares (so a split 9 for 10). They refer to the 2022 annual meeting, there they stated as one of the resolutions:

    “Authorise the Board of Directors to increase the share capital through capitalisation of reserves
    available for the effect and for a total amount of up to 15 (fifteen) percent of the share capital from the
    date in which the decision is made, with the increase of share capital being paid-in through an increase
    of the nominal value of the existing shares or through the issue of new shares, according to the
    decision of the Board of Directors.”

    Maybe some sort of tax optimalization? Now 2M shares outstanding again, and I assume 180K shares of those in treasury.

    Interesting to see extra volume around this notification… maybe it has a certain purpose?

  4. Patently Absurd

    I am currently invested in Conduril, believing in its long-term growth potential.

    Have you conducted any analysis to understand the reasons behind your investment error in the past, specifically ten years ago? During that period, the low PE ratio could be attributed to the company’s projects in Africa, particularly in Angola. Additionally, the PB ratio consistently remained low for this company. It is plausible that the PE ratio should have been adjusted, considering the payment structure involving Angolan bonds.

  5. Patently Absurd

    I noticed that the table lacks information regarding the payments made to the board of directors. From my understanding, it seems that the directors’ payments experienced a significant increase following the rise in profits, while remaining constant despite increasing losses.

    I am concerned about the substantial difference between the payments to the board of directors and the amount invested and dividend payments. Considering our company’s small, family-owned nature, this discrepancy is worrisome to me.


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