Ann: Investor Presentation Notice, page-5

Hey @Imarugbyhooker, I sent my questions in prior and they were asked on the call by the host.

Regarding takeovers and acquisition activity in the space (and the corresponding valuation multiples) (which was one of my questions), underwriting businesses like ENA are valued either on a multiple of EBIT or on a percentage of gross written premiums (GWP).

Ultimately, it all comes down to size. The larger the business, the higher the multiple, to the point where medium to large firms with more than $100m AUD in GWP are valued on close to a dollar for dollar with GWP (1:1 ratio, i.e. 100% of GWP).

Currently, I think fair value is in the order of ~50% of GWP, but as ENA scale, I think that ratio will increase to ~75% of GWP and potentially higher. Tom Kent mentioned examples of historical transactions occurring at north of 40x EBIT.

@claud1990, the call was also recorded and will be available to the public on the Reach Markets website.

In terms of growth, ENA appears to be highly efficient. Across the industry, each employed underwriter typically handles around ~$2.5m AUD of written premiums. But the ENA AUS business appears to do about ~$3.75m AUD per underwriter because of their system (tech) enhancements.

So, to borrow an analogy from a smart friend: "ENA is the BHP in iron ore (Fe) on the cost curve".

I like this business: It is profitable, with high gross margins, is growing well, has proven management and most certainly flies under the radar (because, and no offence to anyone, insurance is not always a riveting topic and is dismissed by most!).

This is a long term compounding machine.