The ALS Limited (ASX: ALQ) share price closed lower on the ASX yesterday after the release of its annual general meeting (AGM) results on Wednesday, followed by an article in the Australian Financial Review (AFR) discussing the company's race in AI automation technology.
What did the AFR article say?
Yesterday's AFR article looked at the ALS business and discussed how the laboratory testing and inspection company is in an international race to develop artificial intelligence (AI) and automation technology that will "drive lower-cost growth".
As mentioned, the company is investing heavily in AI and robotics technology to increase its competitiveness but ALS CEO Raj Naran said timing will be critical to realising the value of that investment.
Mr. Naran told the AFR, "I think it's not so much having proprietary software, it's really being first to market with the technology."
He added, "Our peers are investing in it and I think it's really the ones that deliver first will be the ones that are going to deliver."
The Aussie testing and inspection company has a wide portfolio of clients across mining, food and pharmaceutical industries, with offices in more than 65 countries and is one of the largest service providers of its kind in the world.
What did ALS announce in its AGM?
ALS held its AGM on Wednesday with the executive team commenting on several key factors for the group.
Mr. Naran said the company's financial performance for FY19 was positive despite "uncertain and volatile macro-economic conditions" despite declining margins in its Industrial division.
The company noted its exit from remaining laboratory services in its Oil & Gas segment, while Mr. Naran's comment on headwinds for FY2020 was a factor in sending the ALS share price lower.
Mr. Naran discussed recent changes to tax rules and movements in the Australian dollar as particular challenges for the group, while the absence of exploration investment and equity raising in the commodities sector has impacted global sample flow volumes compared to last year.
Positively, the group reported a 13.3% increase in revenue for the year while its earnings before interest and tax (EBIT) margin climbed 110 basis points (bps) to 15.0% over the past year.
Despite a number of positives for the group, bearish sentiment over the AFR article and concerns over some areas of ALS' business going forward combined to send the ALS share price tumbling 2.9% to $7.01 per share at market close.
