HI ERG just a note on Melbourne Settlement & provision for Sydney. -- ERG trade data forum

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Date Posted: 21:57:33 03/01/03 Sat
Author: Name: Wonder Woman
Subject: HI ERG just a note on Melbourne Settlement & provision for Sydney.

Thank you for using the forum, Wonder Woman
Your entry has now been added to the forum as follows...

Name: Wonder Woman
Location: Sydney, NSW Australia.
Date: Sunday, March 2, 2003 at 4:56:01 PM
Subject: HI ERG just a note on Melbourne Settlement & provision for Sydney.
Comments:

ERG accounting policy in relation to provisions "Provision is raised against pre-contract costs until ERG has won the contract or is identified as the sole preferred tenderer."
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That being the case, it is only an assumption on my part, then in this financial report coming up, the provision that was made for Sydney that negatively impacted the last financial year, won't negatively impact this 6 months, I'm not totally sure of that though do bring the matter to attention of anyone who happens to read.
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This isn't the only provision noticed--ie you have the effect of Pre Payment Cards PCL 47.1%--the reversal negatively impacting last financial year too.
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The entity's writedowns are one off and non recurring in similar fashion there can only be one Sydney and provision can only be made once for now ERG has Sydney- ERG should not make a provison now--for that was done last financial year so this should be a positive, The injunction (call for directions also coming up on March 6th) did not prevent the signing/so perhaps the provision ERG made last financial year will not negatively impact. (going on the dates is was awarded preffered tenderer status) On the 26/7/2002 the court handed down decision (re Cubic verses NSW),afterwards Cubic put in an injunction.
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The judgement was made the 26/7/2002 which falls into this financial year, it depends though up untill what time ERG made provision for Sydney, was it when preferred status was granted? or upon winning?. If not this half definitely next half which is the future period 31/12/02 to the 30/6/03, reporting around September going on previous calendars.
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On the 29/11/02 both Sandy Murdoch and Peter Fogarty both state they have Sydney and it just simply has to be signed.The third stage of the Melbourne Settlement will improve free cash flow, for the next report after the next one on March 6th--in September at it has fallen onto the 2nd half of this financial year.
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Which is the 03 year.Would think stages 1 and 2 can't definitely state though untill the entity reports March 6th, stage 3 definitely is recurring, if you look at the wording of stage 1 and 2--Melbourne Settlement it suggests in this half recurring--stage 3 definitely adds to eps. In this financial half 30/6/2002 to the 31/12/2002.
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Looking at both announcements on the 30/5/2002 and again on the 25/10/02 judgement from me is a boost to eps this half as well as next half.
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It is interpretation of the wording of the two announcements dated the 30/5/2002 and the 25/10/02 and the fact OneLink (two OneLinks one 34% owned the other 100%) reguarly makes payments to ERG Group, so therefore recurring and giving an impact to eps in this half as well as next half, that is how I read it.
Regards,--WW.

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