Ann: Market Update, page-4

Hi Rambo

Thanks for your response, but I'm not sure your points really uncover the mystery of the missing cash.

The market update indicated Dec-14 half year results would be comparable to the Jun-14 half year results (trading EBIT of $1.5m). Depreciation should be around $14m, giving EBITDA of appx $15.5m, which is materially(-ish) in line with DH14 OCF of $12.3m

The MD's address at the AGM, highlighted that in the first quarter of FY15, BOL had reduced debt by $2.4m and achieved assets sales of $3.4m.

At 30-Jun-14, the provision for restructuring was $3.6m, so asset sales in the first 3 months would have been sufficient to cover this expense. There was probably additional redundancy costs in the Dec-14 period, but I would expect these are at least partially offset by reduced salary costs.

So, during the Dec-14 reporting period, I deduce BOL has the following approximate cash movements:

Assets Sales: $3.4m
Capex: ??
Improved a/c receivables position: $8-10m
Jun-13 restructuring provisions: ($3.4m)
Dec-14 EBITDA: $10-15m
Net operating and Investing cashflow: $18-25m

Given the market update advised net debt had reduced $9.5m, I'm left wondering what has happened to the remaining $8.5-15.5m by my estimates. The only scenarios I can think of are:

• A large capex spend
• a deterioration of working capital
• A quirky revenue recognition policy
• I've gone wrong somewhere in my calcs.

Anyways, it's not worth worrying about too much now and I'm probably being a bit pedantic. All will be revealed with the accounts out shortly I suppose.