EPW (ASX) 3 Brokers downgraded

Originally posted by Strawman68 ↑

Brumbypat - one last point - if they hold 1.9m RECS they would have had to pay for them - so lets say $80 as an average market price just for this purpose that's $152m sitting on the balance sheet, now EPW also decide to pay the penalty which they would have to do right now which is $123m to regulator, then lets say they pay $37m to ATO for increased tax, because if you don't make payments to ATO including instalments - you cant have franking credits.....

Can EPW actually afford that much cash out the door - $152m+$123m+$37m - its like a double whammy of the costs either buy certificates and surrender or don't buy them and simply pay the penalty and tax. Does EPW have the money to do both?????

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I think if you re-read the company announcement from Jan 24 then you will be able to fix the above numbers and answer some of your questions.
They say they are paying in lieu of surrendering 1.9million LGC. So they will still surrender some.

They also point back to an announcement from June 20 where they noted that the LGC price had doubled and that their inventory of certificates had increased in value.

That leads me to believe that I am correct in thinking they have a big stash of these certificates and the punt has been paying off well so far. Now they ride it until as close to 2020 as possible when forced buyers are made to cough up, so to speak.

All IMO, DYOR.

3 Brokers downgraded, page-33