dwindling back down, page-8

If turnover is $50m and EBITA margin is 28% (per their capital raise prospectus), then EBITA is $14m. Therefore, on a multiple of say 6 (they have acquired on a range from 5 to 6.5) ), the enterprise value is $84m.

If the EBITA margin is per the original prospectus 20%, then EBITA of $10m equates to enterprise value of $60m

There are 219,517,574 shares on issue per December 2014 report.

Therefore my guesstimate of value is around 27 cents to 38 cents.

However, lets assume turnover is more likely $40m (it was mentioned that AVANA and Real had booked $10m each respectively for half year), not sure what the Service Institute would book, but lets assume $2m (I have no idea), then on a margin of say 20%, the EBITA is $8m. On a multiple of 6 we get around $48m. This equates to 21 cents per share. Given they paid $54m for Real only last year, this may be a little light on (especially if it has been performing as forecast).

We know debt is less than $10m and with the sale of the VETsoftware business, it is likely to be lower (plus there is cash on hand) so effectively Nil.

Overall on my wild projections (DYOR), I think that they should be north of $0.20. But hey, Mr Market ultimately determines price, look at MAH, they have net tangible assets of $0.26 per share yet are trading at $0.05. Sure its exposed to the Iron Ore market.

I think there is value in this stock but any reasonable person would be best to wait for them to release their upcoming projections etc.