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| Subject: 50 mill from the rights issue will go into statement of cash flows | |
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Author: 5/10/2002 some estimates--some of which still relevant |
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Date Posted: 12:27:22 01/14/03 Tue Estimated eps 1.09570943878488452941409389410848 before/afterSydney2.1c ---------------------------------------------------------------------- It is estimated that the Sydney contract is worth 8c per share. (pre stock dilutiion--Proton rights issue) ---------------------------------------------------------------------- http://stocknessmonster.com/news-item?S=ERG&E=ASX&N=208692 ---------------------------------------------------------------------- 207,974,122 new shares were created by the rights issue up untill that time ERG had 627,857,667 on issue it now has 983,302,611 tradeable shares (including convertible notes at a conversion rate of 1 for three shares.) a succesful outcome to the Sydney contract--ie the ITS consortium would add an estimated 50 million dollars to operational revenue each year from 2004 for ten years. 983,302,611 divided by 50.000.000.000 equals 5.08c per share. ---------------------------------------------------------------------- All shares issued tradeable and non tradeable including options and convertible notes there are 1,053,829,000,388divided by 50.000.000.000 equals 4.7446---if a margin of between 5 and 7% is earn't on that revenue it would add at 5% 0.254c to earnings per share or 0.3556 at 7% margin on 5.08c of operational revenue. --------------------------------------------------------------------- On the 4.7446 figure it would add at 5% margin 0.23723 per share and at a 7% margin 0.332122c per share to eps. multiplying the lowest figure of 0.23723 and giving it a forward multiple of 15 times earnings it would equate to an extra 3.55845c on the share price, taking the highest figure of 0.3556 it adds 5.337675c to the share price. (assuming a p/e of 15) ---------------------------------------------------------------------- http://www.stockhouse.com.au/bullboards/viewmessage.asp?no=3999977&tableid=2 ---------------------------------------------------------------------- http://www.stockhouse.com.au/bullboards/viewmessage.asp?no=4007995%20%20&tableid=2 ---------------------------------------------------------------------- Sydney contract adds operational revenue of 50 million dollars per year from 2004 for 10 years. --------------------------------------------------------------------- Subtracting from the above cancellation of employee options on the 19/7/2002 and again on the 23/7/2002 1,053,829,388 minus 236,500 equals 1,053,693,888---One billion and fifty three million six hundred and ninety three thousand eight hundred and eighty eight shares. ---------------------------------------------------------------------- ERG LIMITED 2002-07-19 ASX-SIGNAL-G HOMEX - Perth +++++++++++++++++++++++++ I wish to advise that the following options held under the ERG Limited Executive Option Plan were cancelled as set out below. CANCELLATION DATE NUMBER OF OPTIONS DATE OF GRANT EXPIRY DATE 17/07/02 9,000 17/11/00 17/11/10 17/07/02 60,000 17/11/00 17/11/10 17/07/02 7,500 17/11/00 17/11/10 R Greig ASSISTANT COMPANY SECRETARY --------------------------------------------------------------------- ERG LIMITED 2002-07-23 ASX-SIGNAL-G HOMEX - Perth +++++++++++++++++++++++++ I wish to advise that 12,000 options held under the ERG LimitedExecutive Option Plan were cancelled on 18 July 2002. The expiry datefor the options was 13 January 2003. 150,000 options held under the ERG Limited Executive Option Planexpired on 19 July 2002. The exercise price for these options was $0.93. R Greig ASSISTANT COMPANY SECRETARY ---------------------------------------------------------------------- In reply to: anon 's message, "cancel options19th 23rd1,053,693,888 on issue" on 12:55:54 09/02/02 Mon ---------------------------------------------------------------------- ERG LIMITED 2002-08-30 ASX-SIGNAL-G HOMEX - Perth +++++++++++++++++++++++++ I wish to advise that 358,594 options in ERG Limited were cancelled on 19 August 2002. The expiry date for the options was 1 February 2009. R Greig ASSISTANT COMPANY SECRETARY ---------------------------------------------------------------------- http://stocknessmonster.com/news-item?S=ERG&E=ASX&N=222870 ---------------------------------------------------------------------- If all noteholders convert full holdings I make it then 1053,693,888 plus 41,486,967 equals 1095180855 thats all shares options and notes trading and not trading. ---------------------------------------------------------------------- If all notes are converted, ERG will issue 41,486,967 new ordinaryshares to the three convertible noteholders. The noteholders will beentitled to a payment from ERG based on the difference between $0.55and the sale price of ERG's shares. Any notes not converted will beredeemed on or before 15 November 2002 (or such later date as is agreed between the holder and ERG). ---------------------------------------------------------------------- Since the above was done ERG have changed it's business plan---it now receives the project money up front if we exclude the sale of the telecoms business revenue and normalise it--revenue actually grew by 25% not 1%---so therefore to get an approximation of ERG's immediate EPS while it is between financials would be to visit--the year before it sold it's telecom business---the figure is (b) Diluted EPS 9.6 c different from (a))Weighted average number of ordinary shares outstanding during the period used in the calculation of the Basic EPS 211,028,720-----now 1095180855 25% increase on 9.6c is 2.4c equals 12c per share---divided by 1095180855 equals 1.09570943878488452941409389410848--adding (excluding costs that ERG would receive for contract delay (The consolidated entity has incurred costs relating to the delay of the Sydney contract ITS of 6,637,533) (6,637,533 divided by 12 equals 553,127,75c for each month of delay) 100 million up front for the Sydney contract (ERG have already arranged sybdicated finance for that so they don't need to spend the 100 mill) dividing by 1095180855 equals 9.13091198987473774511744911757063--assuming ERG were to continue operating along the lines of how they used to operate but instead of swapping equity for debt as is now the enties business model--going to the bonding market and various sydndicated lenders that are unique to each project deducting 5.357% from 9.13091198987473774511744911757063---rounded to make the equation easy 9.13---divided by 5.37% equals 0.490281--(in other words the entity is only utilising 0.490281% of 100 million per year----yet has the remainder of the money to improve free cash flow)--adding 0.490281 to 1.09570943878488452941409389410848--rounding again to 1.96--equals 2.1c per share (tradeable and non tradeable--including notes--listed and unlisted) multiplying by the historic low for the S&P500 8 times earnings gets 16.8c---multiplying by 10 times gets 21c---multiplying by 12 times gets 25.2--multiplying by 15 times gets 31.5---the entity histroically grows it's earnings per share a median avergae of 45 times--which equals 94.5.---with todays market obviously it is a more conservative equation--even so the lowest figure at 8 times earnings arrived at is 16.8. I have taken the 30 year bond rate--ERG might use the ten year--which is lower--also Ive included all shares--when in practise it is just those that are trading. ---------------------------------------------------------------------- http://wwws.publicdebt.treas.gov/AI/OFNtebnd ---------------------------------------------------------------------- 30-YEAR BOND 02-15-2001 02-15-2031 5.375 5.460 98.753 912810FP8 --------------------------------------------------------------------- http://stocknessmonster.com/news-item?S=ERG&E=ASX&N=165665 ---------------------------------------------------------------------- The increased operating profit margin (7.8% of sales compared to 5.8%in 1998) --------------------------------------------------------------------- Essentially growth of EPS is about time and space. The very salient point about ERG is it is immediately impacting it's financials as soon as it wins a contract---not a few years hence as was the old business model. ---------------------------------------------------------------------- http://members.fortunecity.com/tvthemes2/i/its_about_time.wav ---------------------------------------------------------------------- http://www.austehc.unimelb.edu.au/tia/titlepage.html ---------------------------------------------------------------------- http://www.austehc.unimelb.edu.au/tia/titlepage.html ----------------------------------------------------------------------  ---------------------------------------------------------------------- If you take out Sydney altogether and give ERG a p/e of 15--then it works out at the approximate recent low--ie 15 times 1.09570943878488452941409389410848 equals (rounding) 15 x 1.1---15.15---if I didn't round it I would think maybe exactly 15.5 ---------------------------------------------------------------------- [ Next Thread | Previous Thread | Next Message | Previous Message ] |