ZEN - Where have the buyers gone?, page-30

Well, I found the numbers.  I was silly to not find them before.  I just needed to read the half year presentations (all of them, accounts and all).  What I have wrongly done is this:  believe the ZEN management forecasts in the yearly (as there was no reason not to).  Then later believed a post/analysis here suggesting management have been dishonest in their forecasts.  So one has this interesting decision to make.  What will will the profitability of ZEN be over the next year or two.  In short, is it a simple/solid 7 to 10 cents earnings per share?  Or is it a 2 cent, unreliable EPS - or even a loss making company when the next borrows cost is factored in?

Interestingly, when I read all the reports, nothing 'went wrong' 2nd half.  At half year, ZEN forecast the full year numbers pretty close to what they were.  They knew revenue/profit was a big skew to first half.  So where did the magical new, one off revenue come from.

From note in the half yearly accounts....  

"Significant Revenue and Expenses– Project revenue includes revenue from Engineering, Procurement and Construction (EPC) contracts delivered during theperiod."

So, my uneducated view say they got paid for doing some one off  'construction' contract.  They knew it was finished and they projected 'revenue and profit must less in 2nd half'.  Now they have two models for operation, the MOM and the BOO.  They want more BOO (where they take on the costs of build, so they own).  So I guess they got paid for a big MOM contract, and that is the one off.

Now, interestingly, Mr Market did not figure this out.  And bid the share up to 1.24.  Am I to believe Mr Market did not read the above paragraph from the accounts, and Mr Market also did not read the full year estimates that were clearly given in the half year.  And now that the full year is not double the half year (ZEN never predicted that) Mr Market slashes the price 40%.  What a dumb Mr Market.  It gives me a lot of hope if I get my finger out and READ all the detail available.  So,  I have learned a $500 lesson!

So, let us hypothesise what ZEN is worth now, going forward.  Without this one off revenue  should you simply double the 2nd half revenue/profit.... and then introduce new borrowings costs?  So it gives you a LOSS making business - as some here try to get us to believe (is that called downramping, when you give a negative opinion and you back it up with clearly incorrect or incomplete data)

Now here is the interesting question:  how can ZEN project revenue and EBITA for the next year to be 5 to 10% higher with this past first half construction revenue and profit GONE.  I think that is easy to say.... ZEN indeed know the BOO contacts in place and the revenue.  So to 'conclude' that you just 'double' the 2nd half performance to value the company (or you 'imply' that) is very naughty.

So it seems I have lost $500 (5% of my $10,000 investment - I sold out on Friday) because I listened to some non factual downramping.  Well, live and learn.  I will not finish my ZEN numbers / projections here.  If one takes all the info on hand, the business is simple, and if you believe what the management have said, you can get at what 'should' happen going forward over the next 1 to 2 years.  Then you will know if ZEN is worth a long term investment.

(note:  I sure hope some of them millions of shares hit the sell side of the market over the next month or three;  maybe I can get back in less than my silly 78 cent sell).  I have a sentiment on ZEN, but I list NONE.  Because I fear on the world macros and crazy markets right now... and the escrow shares to hit the market.  We will see what happens.