Ann: September 2017 Quarterly Update & Appendix 4C, page-61

Hi everybody.

I've had a chance to properly digest the figures now and just blown away. Trying to pin a fair value at the moment is tough as it heavily depends  on your assumptions for growth and what P/E multiples you think people would be prepared to pay.

However, (very) conservatively these are my numbers for the FY18 cash profit forecast. I've assumed 30% quarterly growth.

Q1 = 5.6m cash profit
Q2 = $7.3m cash profit
Q3 = $9.5m cash profit
Q4 = $12.3m cash profit

FY18 = $34.7m Operating Cash Profit

Now if we forget about the revenue deferral accounting adjustment, and just apply cash profits to standard P/E multiples, we get...

P/E 10 = $347m
P/E 20 = $694m
P/E 30 = $1,041m

This confirms for me that even at the current valuation, we are only on a P/E of roughly 10 based on this years projected cash earnings.

The caveat with the above, is that actual accounting profit will be a lot less due to the revenue deferral . The revenue deferral balance could be close to $50m by the end of this year (offset by the release of $9m from last year, so net of $41m coming out of the FY18 figures) which puts us back close to  small loss in terms of accounting profit. This will always happen with such a high quarterly growth, as expenses in Q4 will be the highest yet revenue will almost all be deferred to the following year.

All IMHO of course and DYOR etc.