Ann: DTL expects to report strong 1H FY22 earnings growth, page-10

Placing the $18m DH21 PBT in historical context demonstrates just what a bananas result it is:





And I think your valuation assessment is on the mark, but it is even more so when viewed on an Enterprise Value basis to account for the strong net cash balance at any point in time.

Growing your $34m NPAT for FY2022 by 15% in FY2023 (because that's the year the market will be looking out to, before long) it gives FY2023 NPAT of $39m i.e., PBT of $55m.

There's about $1.5m pa in lease-related interest, so EBIT = ~$56.5m.

And with D&A running at around $5.5 m pa, that means EBITDA = ~$62m


Now, what are the appropriate EV/EBITDA and EV/EBIT multiples for business with DTL's exceptional financial pedigree and track record?

Personally, as a mere base bones scenario, I would be more than happy to pay 20x EV/EBIT, which equates to around 18x EV/EBITDA.

So that suggests lower limit Enterprise Value of 20 times $56.5m = $1.15bn

The average net cash balance over the course of the year is probably around $100m, which means a lower limit Equity Value of around $1.2b5n, or $8.00 per share


So, despite today's share price leap, I think the stock is still at least 20%undervalued.

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