I am a long-term holder of Hansen and accept the FX impacts ......

I am a long-term holder of Hansen and accept the FX impacts ... both positive and negative.

In particular, the average AUD/GDP exchange has been volatile:
1H16 = 0.4713 (HSN)
2H16 = 0.52 (my estimate)
1H17 = 0.5897 (HSN)
2H17 = 0.60 (my estimate)
1H18 = ?

Compared with the 1H17 v 1H16 'gap', the 2H17 v 2H16 'gap' has narrowed. On the other hand, Hansen increased its UK assets with the purchase of Hi-Affinity. I think the improvement in the 'gap' was cancelled out by the increased UK assets. However, FX impacts in 1H18 will be compared with 1H17 (0.5897). With 7 weeks of 1H18 already gone, the average AUD/GBP exchange rate is around 0.60 (my estimate), a substantial reduction in the 'gap' with no increase in UK assets. If this trend continues through 1H18, we could expect a substantial reduction in the FX impact, with consequent increases in Revenue and EBITDA.

For reference I have included the average AUD/US exchange rates:
1H16 = 0.7231 (HSN)
2H16 = 0.74 (my estimate)
1H17 = 0.7536 (HSN)
2H17 = 0.75 (my estimate)
1H18 = ?

Again, the 2H17 v 2H16 'gap' reduced but was offset by an increase in US assets increase (Solutions). With 7 weeks of 1H18 already gone, the average AUD/US exchange rate is around 0.79 (my estimate), a substantial increase in the FX impact, with consequent reductions in Revenue and EBITDA.

The overall Hansen FX impact in 2H17 was $4.3m (negative) which compares with the 1H17 impact of $4.4m (negative).

Overall FX impact for 1H18 could be ?? ... lower (UK) and higher (US).


My second comment relates to the change in 2H17 Revenue and EBITDA compared with 1H17.

Revenue (+1.0%)
1H17 = $86.9m
2H17 = $87.8m

EBITDA (-10.5%)
1H17 = $23.8m
2H17 = $21.3m

Hansen has said the reduction in EBITDA relative to Revenue was due to the direct costs of servicing the UK assets from Australia. Do we buy this? I would have expected to see a big improvement in EBITDA in both Solutions and Hi-Affinity as the acquisition costs were mainly expended in 1H17?