Ann: CEO Presentation-2017 AGM, page-19

I picked up on something the other day that I probably should have considered some time ago as being more material.

The difference between bad debt expense and amounts written off cumulatively over the past 5 years is approximately $47M. That is essentially $47M worth of potential earnings that could have hit the bottom line had management not decided otherwise. And now that they appear to be consistently 'under' expensing bad debts (the cumulative difference peaked at $55M in 2015), we could start seeing a portion of these 'potential' earnings being realised as this gap is further narrowed. If the two are eventually made to balance over the next couple of years, it could potentially add, after tax, around $0.068 in additional earnings per share.

The most immediate question however is whether or not management needs to utilise this 'surplus' to maintain the current level of earnings, or if they can in fact be considered as a bonus. I'm still trying to establish a consensus on the matter.


Please excuse any discrepancies as I've only just started digging into this, but if anyone else is also reviewing please let me know.