Founded in 2007, Management Resource Solutions (MRS) is an Australia based human capital resource consultancy and project management service provider. The company listed on AIM in December 2014 with a remit to expand the business via targeted strategic acquisitions.

• Niche provider of skilled personnel and project management

  MRS’s traditional business has been the supply of specialist and highly skilled personnel for the delivery of clients’ engineering projects. This is complimented by a growing project management business which provides clients with a fully managed service in areas including engineering design, procurement, fabrication, site construction and commissioning.

• Plant hire acquisition more than doubles the size of the business

  In January 2016, MRS finalised the A$13.4 million reverse takeover of earthworks specialist Bachmann Plant Hire. The deal, completed at a discount to net assets, more than doubled the size of the business in revenue terms and was immediately earnings enhancing.

• Proposed acquisition of SubZero Group equally transformational

  By 30th September 2016 MRS expects to complete the acquisition of certain assets from mining services business SubZero Group. Upon completion, the enlarged business will have pro-forma annual revenues of approaching A$80 million, representing an eight-fold increase in the size of the business since 2014.

• Shares trade at a large discount to UK peers on Price/Sales metrics

  Providing further valuation uinderpinning, the shares also trade at a large discount to certain UK listed peers based on forecast 2017 and 2018 price to sales valuation multiples.

• Peer analysis valuation suggests upside of 100%

  Comparing MRS to select ASX listed peers on an EV/EBITDA basis gives our fair value June 2017 target price of 25p per share. We initiate coverage of MRS with a Conviction buy stance.

• DISCLAIMER

  Management Resources Solutions (MRS) is a research client of Align Research. Align Research holds an interest in the shares of MRS. For full disclaimer information please refer to the last page of this document. This investment may not be suitable for your personal circumstances. If you are in any doubt as to its suitability you should seek professional advice. This note does not constitute advice and your capital is at risk. This is a marketing communication and cannot be considered independent research.

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