ALC - Valuation Overview, page-143

I guess becomes much more interesting now....(Note this doesn't include any revenue from today's deal)

This thread (pls go to first post) provides a timely reminder of where ALC stands from a relative value perspective against its peers, across the same metrics.

In a nutshell, we should be trading at close to 20c based on our performance & late last year we were making our way towards that benchmark until the 'xmas slow period' dawned and everything ground to a halt.

Today's deal is worth c. $500k p.a. over 5 years. This adds c. $10m to the value to the business based on it's peer group which all trade at 20x sales. This is c. 2 cents per share.

Remember the key valuation metric here is 20x sales... Annualised sales prior to today's ann are 5.79m which = valuation of 115.8m (or 19.5 cents per share).

So - new valuation is 125.8m or 21.5 cents per share.

This is all without the major NZ contracts which are expected to close this quarter & any additional iCVIS deals out there which there would be many.

Another reminder of the size / scale of the NZ deals... given they are being dealt with by the District Health Board approval delegation.

Think of a hospital hierarchy & approved spending delegations. They may go something like this:
- Hospital Department Head - sub $50,000 contracts
- Hospital CEO - sub $250,000 contracts
- Hospital Board - sub $1,000,000 contracts
- District Health Board - >$1,000,000 contracts

(Note that a $1m contract adds c. $20m in value to the business (3.5 cents) given the valuation metrics our peers trade on. One $1m contract would bump our fair value to around 25c)