Alloy Steel Inc. (fka AYSI)

[littlefish]

Dokkay I never said I never sold AYSI.

When I found MXC, I sold a pretty good chunk of my AYSI back then to buy MXC (that was back around Feb-March 2008 I think approx).

AYSI was still my biggest holding, but when MXC took off, it overtook AYSI in my port briefly before I got more aggressive selling down MXC.

I have since sold almost all shares of MXC and have rolled a good portion of that cash back into AYSI.

However, my current AYSI position is SLIGHTLY smaller in share count than at my highest point.

As for my thoughts on management, I like Gene's fiscal stewardship the most.
I also find the product very compelling. That has not changed, and the launch of what should be the world's thickest single pass alloy overlay wear plate enhances my thoughts on the company's product reliability and separation from the competition.

However, it is clear steelmakers are getting pounded, car sales are down dramatically, the Olympics are over, etc... So world demand for iron ore should be softening quite a bit in the near term. But there wasn't nearly enough capacity available beforehand so now we're more into a slowing of demand than a contraction.
And FMG is capitalized well enough to get their 2nd expansion off and running.

Plus as I've mentioned,I think the 2nd mill will probably help the company leverage itself to potential customers that may have not taken a 2nd look at them before.

Maybe they can get something like an OEM agreement going like they initially had as an MOU with UT awhile back (but that fell apart before being finalized- who knows maybe Gene saw FMG coming down the pike and felt they couldn't get enough plate made fro the UT deal possibly but that's just total spec on my part and could be totally off).
It would be great to see some kind of stream of/recurring orders like the way the UT deal was set up. But apparently the conditions UT sought in the deal weren't good enough for AYSI to accept or at least something held the deal up.

For now though, just having FMG has nearly overwhelmed them with just the one mill and their existing customers.

I know things are softening significantly in the mining sector obviously but I am still thinking this company can take advantage of opening up into new markets with time (harder in current environs but still doable). It is very hard to expand when one major customer has tied down that much of your production.
Getting the 2nd mill will allow them to reach out more and hopefully take on these larger orders like the $600K+ order from Malaysia. The more orders they can land in that range that are not from FMG, the more potential I see for the company going forward.
Most of their customers, once they try the plate they stick with it IMO.
As I recall from phone conversations, the US distributor person (before they stepped down as a distributor) mentioned their customer retention rate was excellent if they could just get the plate.

Anyhow, I'm not gonna give you all my info no matter how much you try to get it out of me :)