implant and apples.the osborne trading contracts were outstanding complications to a complicated structure-that really didn't make sense for BBI POwer at the time.2009. It left them open for uncertain liabilities,which are not good when your trying to get banks to keep lending to you.
This has next to nothing to do with the gas price it is and was paying for its power stations and to retail customers. That issue came up a full 6mo later.yes,i too at the time would not have bought shares had i been aware of the potential liability.I would have waited till it was sorted and bought them at nearly half the price now. The reality is it has cost them exactly what? In cash $70 million that they had to borrow.They haven't needed to take the extra $30m that they had provisioned for.The only other changes are writedown on energy trading of around $170m(paper loss) soon to be added back i imagine over the next two years as the last of their gas contracts roll off. In the meantime they're making another 17% on the power they retail and not all of that comes from gas,some comes from coal fired stations that they don't even pay the coal price to feed. Yes most power is sold on the trading market-but once again i draw your attention to the bottom of the last announcement i.e integrated power co.supplying retail and commercial customers in a number of Australian States. Seems like the new emphasis is on cutting out the middleman and making real money.You don't need power stations for that,but you do need customers and they're after them.
AEJ Price at posting:
5.1¢ Sentiment: Buy Disclosure: Held
