Ann: Full Year Results Presentation, page-5

Is it genuinely and definitely cheap at 22c, though? I don't think it is - PRT's earnings are going backward at such a breakneck speed that it's impossible to know what cash flows to equity will be from here. That's been my issue for the last 18 months.

The way i see it, they've got $15m net debt, plus they need to pay the $15m upfront affiliation fee (which i don't think appears in the FY18 accounts as the deal was closed 20 August); so, PRT today is effectively $30m in net debt. That's 2-2.5 years' NPAT on FY19 $12-15m guidance, but we know FY20 is likely to be worse than FY19 due to another step-up in affiliation fees. If NPAT steps down to, say, $10m in FY20, then PRT is not going to pay a dividend until FY21 at the earliest. So, if you were to do a reasonable DCF (equity) of PRT from here, i'd say:

- Nil cash flow until FY21
- FY21 close to 100% dividend payout; NPAT maybe starts in FY21 at $10m but continues to decline
- Run-off to zero over 5-10 year period; no terminal value
- Applying a 15% discount rate to that and you won't get anywhere near $0.22.

I actually think PRT is worth $0.12-$0.14 based on my view of the industry and the terms of their updated affiliation agreement.