Hi,Very encouraging comments by Vaughn Bowen on estimated end...

Hi,

Very encouraging comments by Vaughn Bowen on estimated end year and 2011 results(link at bottom):

- Made early announcement on end year results because M2 business model is now supported by stable and predictable earnings. The business is very stable with improved forecasting across the business groups.
- M2 seeing a large step up in underlying revenues and earnings.
- Result of tightened internal cost controls, efficiencies, bigger margins, larger volumes and a stable customer base.
- Increased earning revenue. For every dollar of revenue for 2010 7.5 - 8 cents earnings. In 2011 will be 10 cents / $1 of revenue!
- Acquisitions remain on the cards. One of M2s key competencies is making acquisitions work.
- However M2 does not need acquisitions to grow. Seeing strong top and bottom line earnings also being driven by organic growth.
- EPS strong - balance sheet amortisation cost (non cash item) further hides some of the underlying strength!
- Confirmed Div pay out policy - 70% minimum. Some capital expenditure needed, but because low infrastructure telco...can continue to maintain high payout ratio.
- Will be a winner under NBN (broad band network). NBN will level the playing field. M2 is already positioned well as a reseller with very good strategic relationships Optus / Telstra. M2 business model is ideally positioned and proven.

So in summary - as the market begins to recognise M2 earning are now stable and predictable and growing....this should remove any historical uncertainty and lead to the substantial re rating of this high quality well run business IMO.

Vaugh Bowen and the team you are legends!

http://www.brr.com.au/event/67048/m2-issues-strong-earnings-growth-guidance