Comment "TIM has decided to stand out of the MIS market in 2009. It intends to sell its forestry land portfolio and selected horticultural assets, to reduce debt and fund future capital obligations. These are clearly measures to reduce debt and operating cash outflows. We expect annuity revenues to increase from A$321m in FY08 to over A$400m in FY10, continuing to represent a valuable income stream going forward. However, in the short term, ongoing capital obligations, working capital growth associated with past projects, and interest costs (in the absence of asset sales) will continue to hamper cash flow. Given the uncertainty surrounding the company’s future, we have little confidence in our forecasts. Our forecasts assume no asset sales, which could prove difficult"
Neil
TIM Price at posting:
17.0¢ Sentiment: Hold Disclosure: Held
