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Valuation of $1.480
Added a month ago

Scroll down - latest updates are the end...

23-July-2021: I do not follow this one closely enough to add much value here unfortunately. They're in my virtual portfolio, but I've been selling down and taking profits there. The wind has come out of the sails a little in the past couple of weeks, and I think they need to have a ripper of a report next month to get them to resume that upward trajectory once again. My gut feel is that 40 cps is reasonable knowing what we know now, and anything above that is probably pricing in future growth that is not guaranteed to happen, but well might. In that light, they do look a little overbought above 45 cps, and if they have a poor report or even an ordinary report, I can see further downside. That said, I'm obviously wishing they do shoot the lights out, for the sake of all of the XRF shareholder we have here on

25-Oct-2021: Update: ...And they did shoot the lights out, great report, and here they are testing all-time highs once again around 66 to 68 cps. Wish I still held them in real life. Not only has their share price been flying, they've also upped their dividend every 6 months since 2017, including through Covid.


At least I still have some XRF in my SM portfolio...

Upgrading my PT to 77cps.


03-Nov-2022: Update: Raising my Price Target (PT) from 77 cents to 90 cents because the company is now trading at 80c, i.e. above my previous 77c/share PT. The company continues to perform well and surprise the doubters, however I think it will take a fair bit to push through $1, so they might hang around 90c/share or thereabouts for a while before having a few goes at $1 and beyond.

I'm not going to talk about the company's fundamentals because it's not a company I follow closely now, and not one I currently hold IRL (although I have previously, and I did follow them a lot more closely then). They're in my virtual portfolio however, and they've performed well for me, albeit it's a relatively small position, as many of my positions here are. I was just looking through and noticed that this "valuation" was stale, so thought I'd "refresh" it. So I did.





10-Sep-2023: Updating this one again: Once again, I have to move my price target (not a valuation, just a price target) up, because the SP has overtaken my old one yet again and the business has outperformed even my lofty expectations.

I'll target $1.48 this time, and I know that's not particularly brave, since XRF closed at $1.41 on August 1st this year and were as high as $1.435 in intraday trading back then, however I'm happy to keep raising the bar and watch them sail over it again with apparent ease. There's not much of a negative nature you can say about XRF. They have good management, a good business model, they have products and services that companies and organisations need, they are very well positioned within their industry, and they keep moving in the right direction.

Occasionally they look over-valued by the market, i.e. not cheap, but then they never seem to put a foot wrong, and they don't take too much time to grow into those lofty valuations. Quality company. Quality products and services. One of the few companies who are able to increase their ROE as they grow:


Source (above bar graphs): Commsec.

Below sourced from


While FNArena is showing some NPM decline over the past two years, their Net Profit Margin is still higher than it was FY18, FY19 and FY20, and still above 10%, which is a good NPM for a business of their type. Everything else (Book Value/share, Cashflow, Sales Revenue, Earnings, Dividends/share, ROE and EPS) are all continuing to rise at a good clip.

They weren't always heading northeast at a good clip, but they have been since 2018 (so for the past 5 years), and the company has never looked stronger.


Disclosure: I do hold XRF here in my SM virtual portfolio and I have held them on and off in real life also. Currently not holding IRL, but wishing I was. This is one of those companies that is high enough quality that I should just hold them through and not try to sell in and out and time them so much.

14-May-2023: Update: Marked as stale. No Change. $1.48 still good. XRF kissed my $1.48 price target at the end of April (2 weeks ago) - well, they got up to $1.46 intraday before closing at $1.44 on 30th April. Close enough. Let's see what their results in August does for their graph. Still holding both here and in my largest real money portfolio. I think I did mention here somewhere that I'd bought some XRF, paid just under $1.11 ($1.1073 average price) on Feb 26th this year. Very happy with that entry point. I also topped up here on SM shortly after that.

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Valuation of $1.150
Added 2 months ago

XRF is on track for ~$9m NPAT in FY24, with mid-teens earnings growth able to continue into FY25 aided by the acquisition of the remaining Orbis share which I suspect XRF will execute as soon as possible post 1 July this year. Sticking with a 15x multiple on the midpoint of $10-10.5m FY25 NPAT is $1.15.

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Valuation of $1.300
Added 2 months ago

XRF Scientific Ltd updated valuation of $1.30 based on their (Unaudited) March 2024 Q3 Report released on 16/04/204.

Revenue of $15.2m (13% increase on the pcp)

Profit before tax of $3.2m (15% increase on the pcp)

YTD (Year to Date) Results for the 9 months ending 31st March

Revenue of $43.7m (8% increase on the pcp)

Profit before tax of $9.4m (14% increase on the pcp)

Management expect Q4 FY24 to be positive for all divisions. Key growth focus areas are new product developments, international sales growth, and M&A opportunities.

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Valuation of $1.300
Added 2 months ago

Last valuation was 4 years ago for XRF! I reasoned it was undervalued then, and bought in at 26c. Being the genius that I am I started selling out a year later between 50 and 67c (I kept a small amount irl, but was completely out here on SM)

Anyway, not going to lament it too much (although it's annoying i seem to have to re-learn this lesson over and over again) -- time to correct the error.

Revenue growth has really accelerated in recent years, with a CAGR of >20%. And profit has grown at a greater rate 35%pa

The business wont see as much in FY24, although it will be another record. I'm guessing something like ~$60m in revenue, which would be ~9% growth. But with better margins NPAT could be 15-20% higher at around

For the sake of the exercise i'll say FY24 NPAT is $9m. And I'll grow that at 10%pa for 3 years to get $12m, or 8.7cps.

Whack on a PE of 20 and discount back by 10%pa to get a rough valuation of $1.30.

Pretty much the current price. Factor in another 3.5% or so in gross up dividends, as well as the quality of the business, and it's close enough for me to hold.

A good company at a fair price.

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#3Q FY24 Trading Report
Added 2 months ago

$XRF issued their 3Q trading update.

ASX Release

Keeping it brief, all segments contributed with a positive outlook for the final quarter. Reference made to strong gold prices driving demand, as well as low Lithium price driving lower selling prices and production costs.

One new product was launched - the next generation of weighing device - xrWeigh-S-FL, with other new products on track for FY25.

In short, nothing of note that I can see in the release.

Looking to the numbers, in the context of history, both PBT and Revenue are a whisker below the 2-3 year growth trend, but certainly well within the q-on-q variation to not be a significant departure from steady growth.

No real market reaction - low volumes on either side of the trade.

Disc: Held in RL and SM

Figure 1: XRF Quarterly Revenue and PBT ($m)


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Valuation of $1.170
Added 4 months ago

Had a crack at applying @Rick's McNiven preso and spreadsheets to come up with a crude 1st attempt to value XRF following the recent 1HFY24 results.


  • Using @Rick's xls as the base, I modified the xls as the means for me to internalise the McNivens formula and how it works.
  • I also parameterised the xls for me to input figures from the Appendix D statements, forecast growth etc - figures in red are inputs, figures in blue are calculations.


  • Used a 10% rate of return, about 2x what the current Term Deposit rate is - XRF is well run, conservative etc, so the risk of anything silly happening was very much on the lower end - this was applying the % used by @PortfolioPlus
  • Assumed that NPAT growth for 2HFY24 was 20% - improvement in Germany, Orbis crushers, still strong mining demand etc.
  • No change to dividend payout ratio in FY24 from FY23 at 59%, fully franked - there is still need for some moderate capex for facilities expansion etc but Vince has flagged no major capex, so assuming the same ratio feels about right

Still much to learn but this was a start to the valuation process and it feels "about right".

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#ASX Announcements
Added 4 months ago

XRF have announced the half yearly results as follows:

XRF announces record half‐year result

XRF Scientific Ltd (“XRF” or “The Company”) today announced its results for the December 2023 half‐year:

Key Highlights

 Sales Revenue up 6% to $28.6m from $27.1m

 Net Profit After Tax up 20% to $4.5m from $3.7m

 Record quarterly Profit Before Tax of $3.4m in December Q2

 The business sales revenue and NPAT are growing quite well in Australia with the European division struggling somewhat.

The Consumables division had a strong half, generating a profit before tax of $2.9m from revenue of $9.6m. The mining sector remained the key driver of activity, in which our products are consumed for sample testing processes across production and exploration.

The Precious Metals division delivered revenue of $10.4m and a profit before tax of $1.8m. We experienced high levels of reoccurring orders from mining customers, as increased sample testing requires regular recycling of spent platinum labware products. Economic conditions were challenging for our Germany office, however their results are expected to improve in the second half.

The Capital Equipment division delivered a profit before tax of $1.7m from revenue of $9.7m. $1.1m of Orbis Mining revenue was delayed into the second half, which is expected to be a strong period for the division. Included in the result, Orbis Mining generated revenue of $1.8m (1H23: $3.3m) and total profit before tax of $0.4m (1H23: $0.7m) (50% of PBT allocated to non‐controlling interest). International sales are gaining momentum, particularly in the Americas where significant sales have been achieved.

So in regards to a valuation,

Assuming a NPAT of $9.90 Million in 24/25 ($4.5m + $4.5m x 20%)

So $9.90 Million / 138 Million shares = $0.07174CPS earnings

Valuation = $0.07174 x 15PE = $1.08 per share as a good growth stock

Or as an exceptional growth stock which I believe it is $0.07174 x 18PE = $1.29 per share

All up another very good result

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Added 4 months ago


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#Bear Case
Last edited 5 months ago

Looks like Westferry is no longer in the top 20.

The overhang that is causing the downtrend is starting to make sense

2022 Annual Report


2023 Annual Report


However, Westferry still counts XRF as one of the top holdings


As Westferry is not a substantial holder, we don't know when the sale occurred or how much they have keft

Capital IQ Pro reckons it is zero but from above I think that could be wrong.


Might be a good but pointy question to ask?


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#Bull Case
Added 7 months ago
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Added 8 months ago

Director buying ~170k on market at $13.20.


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#Fund Manager Views
Added 8 months ago

A Coffee Microcaps Interview of Peter Johns, Portfolio Manager at The Westferry Fund talking about XRF

The discussion goes for a bit over 15 minutes from about 16 minutes into this Youtube video (NB: direct link to the start of the XRF discussion)

DISC: Held in RL & SM

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#2023 AGM Presentation
Added 8 months ago

Record revenue and profit

Very strong demand from mining and industrial customers

Strong demand for capital equipment products, currently at record order levels

Launch of new product line: xrTGA thermogravimetric analyser

Continued R&D investment in new products across all divisions

XRF SCIENTIFIC LIMITED (ASX:XRF) - Ann: 2023 AGM Presentation, page-1 - HotCopper | ASX Share Prices, Stock Market & Share Trading Forum



Outlook: We expect the December 2023 quarter to be a positive period, with a focus on machine lead times, xrTGA sales, new product developments and international sales growth 

Return (inc div)   1yr: 22.99%   3yr: 52.81% pa   5yr: 48.26% pa

Market Cap; $132M

*limited analyst coverage along with low trading liquidity holds XRF back. Reduction in mining industry generally


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#1QFY24 Results & Management Me
Added 8 months ago

Combined my notes on the 30 Sep 2023 Quarterly Update and today's meeting with Vince Stazzonelli.

Discl: Held IRL and in SM, looking to top up IRL if the price falls closer to $0.90.


Built this simple revenue xls to get a better perspective of the 1QFY24 results against FY23, will add in subsequent quarters


  • Solid result with PBT growing much more than Revenue
  • Consumables was up 15.8%, Capital Equipment was up 27.5% but Precious Metals was down 14.9% over the PCP
  • Revenue is 5.9% lower than the average FY23 quarterly revenue (average is annual revenue divided by 4)
  • Not a concern given the large forward orders held for Precious Metals, but puts the 1Q result in better context, taking cue from concerns previously about the rate of growth from H-to-H
  • All segments appear to be firing, with the order book for capital equipment at record levels, and production for some products is now being scheduled for the June 2024 quarter


Industry Tests to test quality of a product which XRF Supports

  • XRef Analysis - using X-Ray Fluorescence analytical technique to determine the major components of a sample
  • ICP Analysis - ICP (Inductively Coupled Plasma) Spectroscopy is an analytical technique used to measure and identify elements within a sample matrix based on the ionization of the elements within the sample.
  • Gold - FireAssay and PhotonAssay (C79’s technology)
  • Platinum Labware - this is used in the sampling process. XRF manufactures Platinum Labware for all machines, not only XRF-specific machines

How the XRF Equipment Comes Into Play

  • Orbis Mining Crushers - breaks down (crushes) big rocks to provide powder samples, which are then used as inputs to the various tests
  • XRTGA Thermogravimetric Analyser - a high-temperature furnace, heats up the sample to run tests at different temperature points
  • Market is dominated by key competitor: Leco
  • XRF’s benefits over Leco units:
  • 30 samples at a time vs 18
  • Has heating and cooling cycles to speed up the process
  • User friendly Touch Screen vs separate computer console
  • Reputation of building reputable products
  • Provides complementary data for XRF analysis
  • XrTGA opens up access to new markets for XRF - Pharmaceuticals, Food, Agri-Products, Plastics etc
  • Capital equipment should have at least 7-8 years of life through to 15 years
  • Drives other products - spare parts, labware rework, consumables

Manufacturing Capacity

  • Solved factory capacity issue for Capital Equipment this past quarter
  • Can ramp up production across all 3 segments by adding more shifts - no further major spend to boost capacity is anticipated

International Expansion

  • Already have presence in Europe (Germany and Belgium), North America (Montreal), Australia and parts of Asia
  • Direct sales are fulfilled in Australia
  • Large network of Distributors which are required to provide on-the-ground customer support
  • Not in a position to open offices in many countries - driven by product line and the individual needs of the countries

Cost Pressures

  • Cost pressures of the last 12-18M have eased in the last 3-6M - lead time blow outs
  • Able to pass on price increases to customers who mostly pay based on the metal spot price at the time of invoice
  • Employees were given good pay increases to retain them

Customer Demand

  • Exploration activity mostly focused on Rare Earths, Lithium
  • Exploration spend did not fall in Australia - Gold spend did fall, but Base Metals, Iron Ore continued to perform well
  • Have not seen anything impacted by a slowing of Chinese demand

Capex Management Approach

  • Dividend payout ratio is around 60% - this level of dividends is able to provide required capital for R&D, Inventory and Working Capital
  • On the lookout for bolt on acquisitions - generally like to issue script to fund these acquisitions to incentivise vendors
  • Ideal targets are (1) lab products which have business synergies with XRF’s products (2) used by existing customers (3) are under-developed in market potential
  • Not interested in building business scale as XRF is at “about the right size” - focus is on value adding acquisitions

Key Investor Misunderstanding on XRF

  • Investors misunderstand where XRF sits in the laboratory process
  • High quality products
  • Strong IP
  • Essential in providing data to mines, industrials
  • Critical to customers processes
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#Bear Case
Added 9 months ago

Well it appears that my days as a valued member of Capital IQ pro are numbered

I've been blocked from looking at the most recent estimates

But I still managed to find that XRF had received a downgrade from an unknown broker. My guess it is Euroz

Revenue downgrade of 9%


Sentiment changed to hold


Price target maintained at 1.22

Since Aug 2023, XRF has dropped more than 9%


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Added 9 months ago

Vance S and David B bought around current prices at market. Small purchases ( ~$43k split between them), but a good sign nonetheless, and they may not be done buying yet!

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Added 10 months ago

Adding further info to my comment on why the share price fell. I won't worry about drawing the graph as the numbers show the trend well enough.


My last comment mentioned margins fell, but it was only minor about 2% 2H2022 versus 2H2023

However of most concern is the revenue growth. It was only 4% from end of 1H2023 to 2H2023 versus 16% from end of 1H2022 to 2H2022.

Also earnings between 1H2023 and 2H2023 was only 5% growth versus 22% growth between 1H2022 to 2H2022

In summary it seems both revenue and growth stalled from the beginning of the 1st half to the end of June 2023 down to single digits.

The market reacted as expected, even though the numbers looked good,because the growth from previous period was not as much as opposed to the corresponding period. I think market wanted consistent double digit growth but unless I did something wrong above, it looks like growth is becoming marginal.


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Valuation of $1.270
Added 10 months ago

XRF Scientific Ltd yesterday announced its results for the December 2022 half‐year:

Key Highlights as follows

 Sales Revenue up 46% to $27.1m from $18.5m

 Profit Before Tax up 43% to $5.3m from $3.7m

 Net Profit After Tax* up 34% to $3.7m from $2.8

 Record quarterly Profit Before Tax of $2.9m in December Q2

The business sales revenue and NPAT are growing quite well in all divisions,

Assuming a NPAT of $4.99m in H2 ($3.7m x 35%)

So yearly NPAT = $3.7m + $4.99m = $8.69m

So $8.69 Million / 135 Million shares = $0.0644CPS earnings

Valuation = $0.0644 x 15PE = $0.966 per share as a good growth stock

Or as an exceptional growth stock which I believe it is $0.0644 x 18PE = $1.16 per share 

All up an excellent result 

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#ASX Announcements
Added 10 months ago

XRF Scientific Ltd (“XRF” or “The Company”) today announced its results for the June 2023 full-year: 

Key Highlights

• Sales Revenue up 38% to $55.2m from $40.0m

• Profit Before Tax up 36% to $11.1m from $8.2m

• Net Profit After Tax* up 26% to $7.7m from $6.1m

• Operating Cash Flow up 167% to $8.4m from $3.2m

• Profit Before Tax of $2.9m and Sales Revenue of $14.7m in June Q4

• Final fully franked dividend of 3.3 cents per share


The business sales revenue and NPAT are growing quite well in all divisions as sales are up 38%

My previous assumption for NPAT was $8.69 Million with the

actual being $7.7 Million,

Perhaps I was being a bit optimistic considering NPAT was up 26% from the previous year,

But XRF have also moved into the 30% tax bracket as they were only paying 25% previously,

So this affected the NPAT also by $555,000,

So in regards to a valuation,

Assuming a NPAT of $9.63 Million in 23/24 ($7.7m x 25%)

So $9.63 Million / 136 Million shares = $0.0708CPS earnings

Valuation = $0.0708 x 15PE = $1.06 per share as a good growth


Or as an exceptional growth stock which I believe it

is $0.0644 x 18PE = $1.27 per share 

All up another excellent result

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# August 2023 Investor Pres
Added 10 months ago
  • Summary: August 2023 Investor Presentation
  • e5a84763ce67bfcad0e57bb4b2fa5be6bad503.png


3 x Segments Below:


Return (inc div)   1yr: 98.03%   3yr: 67.98% pa   5yr: 52.85% pa


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#Bull Case
Added 11 months ago

Shares in Value have just emailed their thoughts on XRF, here they are:

Our high-conviction pick for this month is XRF Scientific (ASX: XRF), a significant player in the mining industry, providing essential gas and electric fusion equipment for mineral sample preparation, a prerequisite for X-ray fluorescence analysis. This indispensable process plays a pivotal role in shaping the strategies of industry heavyweights like BHP, Glencore, Vale, South 32, and Alcoa, who depend on it for assessing the grade, reducing waste rock, and formulating drilling plans. The role of sample preparation cannot be understated—it serves as the vital initial step in deciphering a sample's chemical purity and composition. 

We recommended XRF to our members in January at $0.84, and it has grown 58% in the last 6 months to a princely $1.33 (effective 27 July 2023). 

So why do we remain so bullish on XRF? 

XRF's unique non-cyclical attribute offers uncommon stability in the volatile mining industry. Further, the company follows a Gillette-style business model, providing high-margin chemical agents essential for each sample preparation.

Over the years, the company has been undervalued as a mining services supplier rather than being recognised for its inherent value as a premium international equipment provider, a reputation reinforced by 28% and 19% revenues and profits growth in 2022. It also maintained a 60% dividend payout ratio, delivering a yield of over 3%, a beneficial attribute for those pursuing dividend returns. The company's record-breaking order book indicates there is potential for further growth.

With the increasing demand for low-emission technologies driving commodity growth, XRF, central to mining activities, stands to benefit. Looking forward, XRF's ambitious 2023 expansion plan is noteworthy. With strategies targeting geographical diversification, new product launches, and a particular emphasis on precious metals, XRF offers a blend of steady cash flows with a balance of growth and dividends.

A substantial amount of credit for XRF's success is due to the tenacious leadership of CEO Vance Stazzonelli. He embodies the ideal qualities that we at Shares in Value believe are crucial in an effective leader: honesty, accuracy, and a refreshing lack of pretentious adjustments in the financial results. His straight-shooting approach, especially in the small caps realm, sets him apart.

Under Vance's steady helm, XRF continues to deliver exceptional results. Despite the considerable recent surge in its share price, we are confident in our recommendation of XRF, believing in its long-term potential.


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#New product - xrTGA
Added 12 months ago

Competitive Advantages:  Large sample carousel with 30 positions for greater throughput  Higher maximum temperature range up to 1100°C  Highly automated and user-friendly interface  Fast heating and cooling cycle times  Fully integrated PC without the need for an external unit


Had a mighty run -up Return (inc div)   1yr: 104.89%   3yr: 72.11% pa   5yr: 53.00% pa


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Valuation of $1.000
Added one year ago

20/5/2023: A look at NPAT.

Below from the Feb 2023 Report:

2023 shares on Issue: 135,8

June 2022 NPAT actual reported: $6,084Mill

Forecast June 2023: NPAT $7,909Mill = 6,084 x 1.3 ( say NPAT growth is 30%pa )

Find EPS for June 2023: 5.82cps = 7,909 / 135,8

so Valuation Range $1 to $1.35

1st Guess Pe ratio 23% = 135cps / 5.82cps ( Bull )


2nd Guess Pe ratio 17.18% = 100cps / 5.82cps ( Bear )


Market cap:$88Mill

ROE: growth has been good

ROE future: some pundants thinking lower in 2023.

EPS growth likely to tail off in 2023 Free cash flow ok

Free cash flow: current 3.25c out -look 4.47cp

PE ratio 18% then future pe taper off to 15 times earnings

Revenue stream or silo's of cash from Australia , Canada, Europe.

A solid performance will the buyers get excited again..

Return (inc div)   1yr: 38.08%   3yr: 55.22% pa   5yr: 35.49% pa



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#D. Brown Appendix 3Y
Added one year ago

David Brown: Consideration $60,180

Securities   b) 3,059,163   Securities held after the change b) 3,110,163



Good 1yr Price trend here


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Valuation of $1.400
Added one year ago

I’ve been watching XRF but still don’t own it unfortunately. Congratulations to those who jumped on board.

@Winiwas spot on in forecasting the incremental growth rate in ROE. Generally other analysts didn’t see this coming so I should have taken more notice of Wini’s forecast!

Assuming FY23 NPAT of c. $11 million and current equity of $49 million, that puts XRF on FY23 ROE of over 24% (even higher than Wini’s forecast of 22.5%). The ROE chart is likely to look something like this for FY23. That’s a significant jump and supports Wini’s view that XRF is a capital light business.


@edgescape put forward a valuation of $1.58 based on historical PE ratios x forecast FY23 earnings. If I use McNiven’s Formula assuming a forward ROE of 24% and a 10% required return on investment I get a similar valuation to Edgescape. If you were requiring a higher return on your investment, say 12%, the current valuation would be $1.20 or about the current share price. If the incremental growth in ROE continues into the future this will push the valuations higher still. Wini might have a view on what the future looks like from here.

My guess is that share price will now be influenced more by share price trends and the chartists in the short term, so I wouldn’t be surprised if the share price reached $1.80 or higher. If I owned XRF I wouldn’t be selling it in a hurry while the green candles continue and MACD sits in positive territory.


However, ignoring the charts and considering a ROE based valuation with a required return on investment of 15%, I won’t be buying at the current share price of $1.20 either. Good luck to those who are holding.

Not held

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Valuation of $1.580
Added one year ago

See my straw added 15 April 23.

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Added one year ago

Adding further on the latest straw with some back of envelope calculations

Assuming that NPAT reaches 11m this financial year as seen in the latest update, then that's a forward PE of 15 based on current market cap.

Currently trading at backward PE of 23. But with NPAT and revenue growing in the double digits.

Given the double digit growth, assigning current PE of 23 instead of the backward figure and forecasting EPS of around 11/160=0.068, a share price of around 1.58 when FY23 ends seems reasonable. However that also depends on whether this is a continual trend or whether XRF will hit a speed bump from a downturn in mining and exploration as a result of a possible recession. Think this is the big question I'm still asking when reviewing the results although they seem confident that there is enough forward demand till the end of the year.

Also need to thank @Wini for bringing this to attention during 2020 when I first entered but as always too late to put the trade in SM. One of the rare cases where I didn't worry too much about the holding!


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#Summary: March 2023 Quarterly
Added one year ago

Sales of capital equipment products have been robust at $3.9m compared to $2.8m in the PCP.  The demand is being driven globally by both the mining and industrial sectors.  Geographical growth is adding to revenue, and certain markets have been reactivated post COVID‐19 impacts.  For some core products our order book remains at record levels, with production now being scheduled into the December 2023 quarter.  We are working to reduce our lead times through the addition of new labour and inventory resources. 

  • Summary:Summary: March 2023 Quarterly Trading Report
  • Price Sensitive: Yes



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#1H23 Results
Added one year ago

21/2/23 Appendix 4D - Half-Year Report

Another fantastic result from XRF, it says a lot that I almost expect it from them at this point.

It's a well covered stock now on Strawman so I will let others break down the headline numbers, but one thing I have been focused on for some time with XRF is how the business is far more capital light than headline numbers suggest.

A simple calculation for XRF shows roughly 22.5% return on equity (rolling 12 months profit before tax of $10.17m on equity of $44.89m). However within that the incremental return on equity is far stronger at 76% for this current half:

$5.67m 1H23 profit before tax minus $4.5m 2H22 profit before tax is $1.17m incremental PBT on $1.54m incremental equity ($44.89m 1H23 - $43.35m 2H22).

Ultimately it is the incremental return on equity that drives share prices rather than the absolute level.

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Valuation of $0.870
Edited one year ago

Really excellent growth in EPS the last 5 years, if it were continue at a similar growth pattern (which I think could be very likely), say 13% with a PE ratio of 20, price is closer to $1.03 once discounted back.

Leaving a little bit of margin for say 9-10% growth gives my current valuation of $0.87. If growth slows to 5%, price would be closer to $0.72.

Would be interested in adding to RL portfolio under $0.80, however will add a little now to SM portfolio.

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#Wini: XRF Results 27-Aug-2021
Added 3 years ago

27-Aug-2021:  Click here to watch Luke "Wini" Winchester from Merewether Capital talking on Ausbiz on Friday (27-Aug-2021) about the recent (24th Aug) full year results from XRF Scientific (from the 3:30 mark of the video), Kip McGrath Education and Austco Healthcare.  Wini was the Emerging Companies Portfolio Manager at Oracle Investment Management (and might still be according to his LinkedIn profile), and is now the CIO of Newcastle-based Merewether Capital, which ARC have just bought 40% of.  Luke discloses that he owns all three of those companies (XRF, KME and AHC) and he's bullish on them clearly, and when Wini is bullish on a company it's worth noting!

Disclosure:  I do not hold any of those companies in RL, but XRF is in my SM portfolio (and ARC is on my watchlist).

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Valuation of $0.500
Added 3 years ago
It's difficult to know whether XRF is at a true inflection point or experiencing a cyclical upswing. Difficult for everyone to know... previously the pessimists were in control seems like the optimists are now. Hence I think it's likely it trades above a P/E of 20 and hits earnings of close to 3 cents per share. Momentum is very positive - Generally last month or so is mean reverting so expect this to continue up for a bit if they have a reasonable quarterly update / full year report.
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#Broker/Analyst Views
Added 3 years ago

05-Mar-2021:  CCZ Equities Research: XRF Scientific (XRF): Stronger testing volumes expected in the 2nd half

Analyst:  Daniel Ireland,, +61 2 9238 8239

  • Recommendation: BUY
  • Target Price: 37cps (down from 39cps)
  • Market Capitalization: $37.5m
  • Index: None
  • Share Price: 28cps (29.5cps on 12-Mar-2021)
  • Sector: Industrials

Stronger testing volumes expected in the 2nd half

  • Performance weighted to 2 nd half:  XRF reported HY21 revenue of $14.9M ($15.7M pcp, -5.3%%) and -12.8% below CCZ forecasts whilst PBT was $2.2M adjusted for JobKeeper (-5% vs pcp). Growth was slower than anticipated due to COVID19 shutdowns in Europe and Canada whilst reordering patterns for flux materials, a critical component in base metals testing and a significant contributor to profit, is expected to be weighted to the 3 rd and 4th quarters. The company continues to develop new machines, with the release of such products expected shortly and a natural extension of the companies long standing diversification strategy away from resources.
  • Platinum Division continues diversification:  The company has not provided guidance for FY21, however testing materials will inevitably increase in conjunction with a strong mining and minerals market. It is expected that laboratories will require x-ray flux materials driven by a surge in mining refit capex. The German office experienced a positive result for the half, profitable for 4 months - achieved via careful cost management and increased service and product margins. With a strong presence in platinum products, the success of this office provides a significant opportunity to diversify the company toward industrial customers with an immediate addressable market of €100M.
  • Forecast marginally changed:  FY21E revenue expectations have been increased to $31.3M from $30.6M, Fy21E EBITDA expectations have increased from $6.6M to $6.7M and Fy21 EPS has been maintained at 2.8cps. Based on the HY21 results we have adjusted revenue for Consumables to $9.5M (7% growth vs Fy20), Precious metals to $13.6M (+7% growth vs Fy20) and Capital Equipment to $8.2M (10% growth vs Fy20). Expectations are for XRF to pay a full year dividend of 1.8cps (+28.5% vs pcp) fully franked, largely due to an improvement in operating cashflow and a large franking credit balance.
  • Investment thesis - Unchanged:  We have reduced our valuation to $0.37 per share. With moderate growth expected from all divisions, XRF is positioned to benefit from the capex refresh cycle taking place in the mining industry. As budgets increase in the industry, XRF is well positioned with new product developments close to commercialisation, a growing customer base and a shift toward industrials customers in cement, aerospace and high-end manufacturing industries.

--- click on the link at the top for the full CCZ report on XRF ---

[I have held XRF shares previously, and they are still on my scorecard.]

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#FY20 Results
Added 4 years ago

XRF saw flat revenue for FY20, coming in at $29.1m compared to $29m in FY19.

Net profit after tax, however, jumped 47% to $3.1m. Thanks to improved product mix and reduced costs.

Net cash improved to $2.7m with 10% growth in operating cash flows and repayment of debt.

Consumables again steal the show, with 11% more sales and an 18% lift in profit. Precious Metals saw a big margin improvement that saw its profit rise 50%.

Capital equipment sales and profit was down 113% and 7% respectively.  

Overall, a good result and in line with expectations. Great to see past investment paying off and there appears to be good momentum going into FY21.

Results detail here

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#Corona Crisis
Added 4 years ago

I think it is very hard for anyone to accurately predict on a macro level how long the current downturn lasts for and the long term effects of it. What we can and should do though is look at individual businesses and assess the impacts to them from the coronavirus, positive or negative.

For XRF I recently spoke with the CEO Vance Stazzonelli who said they have yet to see any impact from the coronavirus with business remaining as usual. XRF's main clients are in mining and construction which have been deemed essential industries even in countries with full shutdowns. The company's offices in Canada and Germany are sales offices with employees able to work from home and sales closed over phone and email. This is assisted by the fact majority of sales are from existing clients.

Vance sees the big short term risk to the business being a forced closure of their Melbourne factory. If the Victorian Government did implement Stage 4 restrictions Vance hoped they could claim an exemption given their products are critical to the mining industry which would be deemed essential. 

The other point Vance stressed was how conservative the company's balance sheet was, net cash and the small debt on the balance sheet backed by the company's Melbourne land and factory. On top of this, the $9m of inventory is roughly six months worth of operations in case supply chains are disrupted with a big chunk of that being pure platinum. With no changes to business operations Vance said the company would release their planned third quarter update in mid-April and saw no need for a specific corona virus update.

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Valuation of $0.360
Added 4 years ago
Valuation updated on 15/02/2020
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Valuation of $0.320
Added 5 years ago
Using some very conservative estimates (please refer to my financial straw), my implied valuation of XRF is approximately $0.32. New shareholder to XRF and has been very impressed with what I have dug up from all their annual reports and other public announcements.
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Valuation of $0.380
Added 5 years ago
Aug 19: Updated for FY19 results and re-calibrating my model. Blended multiple analysis gets a valuation of $0.38/sh whilst a 5 year forecast NPV is $0.42/sh. NPV could be a little bullish subject to risk around small reversion in cash conversion rates which were quite high in 2H19. Apr 19: $0.28 based on 8x EV/EBITDA on FY19 EBITDA of ~$4.90m. Rolling forward to FY20, based on same multiple and EBITDA of $6.90m, target SP is $0.40
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Valuation of $0.330
Added 5 years ago
Now that they are through the investment stage profits are coming through. Sales have been impressively growing so I expect that they will achieve around $4.5m NPAT next year so on a PE of 10 that would be around $0.33
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