ALS LIMITED (ALQ)

Business Description:
ALS Limited (ALQ, formerly Campbell Brothers Limited) is a provider of analytical laboratory and technical testing services to mining, energy, food, pharmaceutical, and industrial sectors. ALS also distributes non-food consumables to the healthcare, building services, hospitality and leisure industries. ALS operates in 55 countries across Africa, Asia, Australia, Europe and America.

Strategy Analysis:
ALS will focus its attention on the Laboratory Services division where it has shown competitive advantage and a proven business model. Geographical expansion for ALS Laboratory Group is achieved through further acquisitions, opening of new laboratories and capacity expansions in Europe, Asia and North America, also diversifying into new analytical services market. This division will continue to be the key profit contributor. Reward Distribution is expected to see gains in sales post consolidation of its national distribution operations and rationalisation of warehouses. ALS reported NPAT up 32.5% to $135.5m for the half-year ended 30 September 2012. Revenues from ordinary activities were $813.6m, up 21.9% from the same period last year. All testing and inspection services divisions recorded strong increases in revenues and profit contributions compared with the pcp. In particular, significant growth in demand for services in ALS Energy, ALS Life Sciences and ALS Minerals saw these divisions post revenue gains of 28% or more for the half. Basic and Diluted EPS was 37.4 cents compared to 29.5 cents last year. Net operating cash flow was $107.3m compared to $83.0m last year. The interim dividend declared was 21.0 cents compared with 19.0 cents last year.