Ann: Nexbis to Commence Malaysian Project , page-21

Behne,

I have two queries to your logic. Firstly, in touting figures of $700m as possible revenues from the contract. I question the justification and basis for that figure - are there similar contracts of that magnitude held by other international companies that you could point to? I don't see how a non-existent (though rumoured) contract in Cambodia can be used as a basis.

Secondly (more importantly), how does that possible revenue relate to the value of NBS? Presumably you must think it to be north of say $100m to be worth investing in at present (given market cap is $75m)? What margins do you think they can make from it and for what upfront investment?

My guess is that any contract of size will be a concession contract - i.e. require large amounts of capital to be invested up front in order to earn the right to collect a tariff from users later. The cost of such upfront investments to early shareholders is commonly dilution. Note there were some early newspaper articles on the Maldive concession contract that referred to costs such as "$US39m to build"! Maybe that figure is completely incorrect or relates to earlier development costs at NBS. However, it is certainly not a free exercise.

There are already ASX listed companies out there with established levels of annual revenue in the $100m's, yet which trade at or below NBS market cap - CAA springs to mind. Revenue alone means little. Why take the risk on revenue that does not even exist!