PPK Group (ASX:PPK) FY19 results & outlook


by Rachael Jones

PPK Group Limited (ASX:PPK) Executive Chairman, Robin Levison talks about FY19 results, strategy, pickup in the company's key market, and the company's joint venture with Deakin University for Boron Nitrate Nanotubes.

Rachael Jones: Hello, I'm Rachael Jones for the Finance News Network. Joining me today from the PPK Group (ASX:PPK)  is Executive Chairman, Robin Levison. Robin, welcome to the network.

Robin Levison: Thank you, it's great to be here.

Rachael Jones: Now, first up Robin, could you please start by giving us an introduction to the company?

Robin Levison: PPK was founded in 1979 and listed on the ASX in 1994. It had a strong history of being a plastics manufacturer, and over time did very well in that business. Recently, PPK has been involved in underground mining services, specifically to clients in the high gas coal area, and over the last 12 months we've become involved in a joint venture with Deakin University around the development of a new nanotechnology called boron nitride nanotubes, or BNNT.

Rachael Jones: And Robin, your JV with Deakin University has been creating a lot of interest. Can you tell me what's involved?

Robin Levison: Certainly. From a an investor perspective and a share price performance perspective, since we announced our joint venture with Deakin in November 2018, we've seen hundreds of new shareholders come onto the register. We've seen both scientific and commercial organizations reach out to inquire about BNNT.

So, really, Deakin, over the last 11 years, have developed a technology for the continuous manufacturing of BNNT, which is not available anywhere else in the world. Also, the markets for BNNT are massive. If you look at flameproof and retardant equipment, bulletproof glass, there are a range of opportunities, which we estimate are around a $60 billion market opportunity for BNNT, assuming we can make it in volume and the correct quality.

Rachael Jones: Excellent. Now to your financial year 2019 results. What were the highlights there?

Robin Levison: Yes, as a board we were delighted with the results for PPK. We resumed profitability in our mining business. We resumed paying a dividend. We paid down almost all of our external debt, and we put ourself in a position where we feel we could grow confidently and maintain that dividend to shareholders, which we know is important.

Rachael Jones: Excellent. Now Robin, let's talk about your strategy and share price. Could you give us a comment for each?

Robin Levison: Certainly. If I take the share price first, it's really looked after itself since we announced our joint venture with Deakin, and I think shareholders should be pretty happy with what's happened. I think also the dividend that we have started paying, that's come from the mining services revenues and cash generation, has also helped, but there is no doubt that the future of the business and why we have received up to 600 new shareholders over the last few months is all about our partnership with Deakin and the development of BNNT, and what a large global market that appears to be headed for.

Rachael Jones: Where would you like to see the company in 12 months' time?

Robin Levison: Our biggest hope is that we've successfully produced, marketed, and sold significant quantities of BNNT. Secondly, we are hopeful that we will have entered into arrangements with other participants in other industries that are using BNNT to improve or enhance their own products that they're manufacturing.

Rachael Jones: Robin Levison, thanks so much for the update.

Robin Levison: It's a pleasure. Thanks for having me.