Ann: LON 1H18 Results Announcement, page-33

If you go back a few months on the LON board there are posts explaining why the absolute number of shares is irrelevant to valuation. LON (or its predecessors) has not done a share split before.

In 2014 Jumbuck did a 1:5 consolidation. After that business imploded and became POP, which then raised capital to buy Maggie Beer at 4c/share, hence the already large number of shares before Laura came on baord.

Then last year LON issued a boat load of new shares to fund the Paris Creek buy. This is what happens with penny stocks when they recapitalise as a new business. You raise capital at the prevailing price and only after that can you do the consolidation. If Laura had started LON as a new independent company, they'd have raised $40m at $1 or something and there'd be less shares but valuation wouldn't have been different. The history of capital issuance is a red herring / noise.

So whilst number of shares is not relevant to valuation, where it is relevant is in the trading of shares and optics. Up until now, the minimum increment you can trade is 0.1c, which against 3.6c is a 2.8% movement. After the consolidation you can trade in 1c increments, which against 90c (i.e. 3.6x * 25) is a 1.1% movement. This is self evidently better. Optically there is a stigma against penny stocks that goes back to the origins of modern stock markets. It's just maths and it shouldn't matter, but it does. It works the same way for extremely expensive shares. In the US they have stocks at $500+ - in Australia when they get up above $100 they usually do a split to keep the price down under that level (CSL being an exception).