i dont think it is to do with BSL contracts was just looking at he 'outlook' statement "Following the sale of USM and the sell down of TSI Fund, an earnings gap will exist while opportunities are pursued to reinvest the proceeds from these transactions. The Company plans to reinvest the proceeds during the second half of FY12.
The Company is targeting an absolute growth rate of up to 5% in operational NPAT (pre-amortisation) in FY12. However, excluding the USM and TSI Fund (RAC) contributions from FY11, the year on year pre-amortisation NPAT growth rate is expected to be 25%. These growth targets are based on USD/AUD parity and are subject to no deterioration in economic conditions"
From what I can gather the company has sold tsi and usm which are income generating assets. now what they have is lot of cash sitting in bank earning interest or a low return So what they are hoping to do is reinvest it in something which will give a higher return. Anyway that is what they appear to be saying.
They may however might be expecting things to go bad and they are subsequently getting some cash together in case of a credit squeeze and they can't get money to refinance existing facilities.
depends if you take what they say on board or you are bit cynical about things
TSE Price at posting:
$2.30 Sentiment: None Disclosure: Held
