ASX:LER

Stock Analysis Report

Executive Summary

Leaf Resources Limited operates in a clean technology industry in Australia.

Risk Analysis

Earnings have declined by -27.72% per year over past 5 years

Has less than 1 year of cash runway

Makes less than USD$1m in revenue (A$358K)

Does not have a meaningful market cap (A$9M)

+ 2 more risks


Snowflake Analysis

Weak fundamentals or lack of information.

Share Price & News

How has Leaf Resources's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LER has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0%

LER

0.8%

AU Chemicals

0.4%

AU Market


1 Year Return

-50.0%

LER

14.0%

AU Chemicals

19.5%

AU Market

Return vs Industry: LER underperformed the Australian Chemicals industry which returned 14.1% over the past year.

Return vs Market: LER underperformed the Australian Market which returned 19.4% over the past year.


Shareholder returns

LERIndustryMarket
7 Day0%0.8%0.4%
30 Day-3.4%1.4%4.0%
90 Day-15.2%-2.3%4.9%
1 Year-49.0%-50.0%15.7%14.0%24.9%19.5%
3 Year-80.3%-80.7%8.5%1.3%38.6%19.9%
5 Year-81.0%-81.3%33.5%16.7%60.0%24.0%

Price Volatility Vs. Market

How volatile is Leaf Resources's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Leaf Resources undervalued compared to its fair value and its price relative to the market?


In this section, we usually try to help investors determine whether Leaf Resources is trading at an attractive price based on the cash flow it is expected to produce in the future. But as Leaf Resources has not provided consistent financial data, and the stock also has no analyst forecast or coverage, its intrinsic value cannot be reliably calculated by extrapolating past data or using analyst consensus cash flow predictions.

This is quite a rare situation as 89% of companies covered by Simply Wall St do have a valuation analysis.


Next Steps

  • Take a look at our analysis of LER’s management and see if the CEO’s compensation is within a reasonable range, who is on the board and if insiders have been trading lately.
  • When valuing a company like this, investors focus more on how they perceive the size of the opportunity, the company's ability to deliver and scale, and the strength of the team. While we are not analysing this type of data at the moment, if you don’t know where to start, we recommend reading through Leaf Resources regulatory filings.
  • Explore potentially undervalued companies in the Materials industry.

Future Growth

How is Leaf Resources forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

26.1%

Forecasted Materials industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Leaf Resources has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Leaf Resources performed over the past 5 years?

-27.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LER is currently unprofitable.

Growing Profit Margin: LER is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: LER is unprofitable, and losses have increased over the past 5 years at a rate of -27.7% per year.

Accelerating Growth: Unable to compare LER's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: LER is unprofitable, making it difficult to compare its past year earnings growth to the Chemicals industry (-1.1%).


Return on Equity

High ROE: LER's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Leaf Resources's financial position?


Financial Position Analysis

Short Term Liabilities: LER has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: LER has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: LER has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: LER's has negative shareholder equity, so we do not need to check if its debt has reduced over time.


Balance Sheet

Inventory Level: LER has a low level of unsold assets or inventory.

Debt Coverage by Assets: LER has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: LER has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: LER has less than a year of cash runway if free cash flow continues to reduce at historical rates of -31.9% each year


Next Steps

Dividend

What is Leaf Resources's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%2.3%markettop25%5.5%industryaverage2.7%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate LER's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate LER's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if LER's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if LER's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of LER's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

What is the CEO of Leaf Resources's salary, the management and board of directors tenure and is there insider trading?

2.1yrs

Average management tenure


CEO

Alex Baker 0

0.9yrs

Tenure

AU$182,367

Compensation

Mr. Alex Baker, B.Sc, GDip.Biotech, MTM, MAICD has been Managing Director, CEO and Non Executive Director of Leaf Resources Ltd since February 1, 2018 and. He served as Chief Operating Officer at Leaf Reso ...


CEO Compensation Analysis

Compensation vs Market: Alex's total compensation ($USD125.86K) is below average for companies of similar size in the Australian market ($USD262.68K).

Compensation vs Earnings: Alex's compensation has increased whilst the company is unprofitable.


Management Age and Tenure

2.1yrs

Average Tenure

Experienced Management: LER's management team is considered experienced (2.1 years average tenure).


Board Age and Tenure

2.6yrs

Average Tenure

68yo

Average Age

Experienced Board: LER's board of directors are not considered experienced ( 2.6 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: LER insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellAU$1,82318 Nov 19
Alex Baker
EntityIndividual
Role
Chief Executive Officer
MD, CEO & Director
Shares56,958
Max PriceAU$0.032
BuyAU$5,29706 Sep 19
Tribeca Investment Partners Pty Ltd.
EntityCompany
Shares110,691
Max PriceAU$0.05

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 32.4%.


Management Team

  • Tim Pritchard

    CFO & Company Secretary

    • Tenure: 2.1yrs
    • Compensation: AU$207.13k
  • Les Eyde

    Head of Research & Development

    • Tenure: 5.5yrs
  • Alex Baker

    MD, CEO & Director

    • Tenure: 0.9yrs
    • Compensation: AU$182.37k

Board Members

  • Bill Baum (74yo)

    Non-Executive Director

    • Tenure: 2.6yrs
    • Compensation: AU$50.00k
  • Ken Richards (63yo)

    Non-Executive Director

    • Tenure: 12.4yrs
    • Compensation: AU$345.46k
  • Doug Rathbone (73yo)

    Chairman

    • Tenure: 1.8yrs
    • Compensation: AU$116.00k
  • Matt Morgan (45yo)

    Non Executive Director

    • Tenure: 5.5yrs
    • Compensation: AU$50.00k
  • Alex Baker

    MD, CEO & Director

    • Tenure: 0.9yrs
    • Compensation: AU$182.37k

Company Information

Leaf Resources Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Leaf Resources Limited
  • Ticker: LER
  • Exchange: ASX
  • Founded: 1996
  • Industry: Specialty Chemicals
  • Sector: Materials
  • Market Cap: AU$9.156m
  • Shares outstanding: 327.01m
  • Website: https://www.leafresources.com.au

Location

  • Leaf Resources Limited
  • 1 Westlink Court
  • Suite 7
  • Darra
  • Queensland
  • 4076
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LERASX (Australian Securities Exchange)YesOrdinary SharesAUAUDJan 1999
LERCHIA (Chi-X Australia)YesOrdinary SharesAUAUDJan 1999

Biography

Leaf Resources Limited operates in a clean technology industry in Australia. It is involved in the research, development, and commercialization of Glycell, a biorefinery technology used in breaking down biomass into components, such as cellulosic sugar, lignin, hemicellulose, and refined glycerol. The company was formerly known as Leaf Energy Limited and changed its name to Leaf Resources Limited in August 2014. Leaf Resources Limited was incorporated in 1996 and is based in Darra, Australia. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/01/27 10:30
End of Day Share Price2020/01/24 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.