EBITDA multiple of 6.66x is derived from the share buy-back and cash on hand as per FY23 Accounts.
I’ve then used the same valuation metric as VGW used for the buy-back for FY24 and FY25e. One could argue 7-8 times particularly if LE tries to take VGW private.
FY25e key assumptions 1. Revenue growth 18% 2. EBITDA margin 13% 3. Tax rate 30% 4. Cash on hand - payout ratio of 72%, after als o deducting buying 13% stake in UK business and $20m payment to ATO for underpayment (probably worst case scenario)
The valuation is very sensitive to the EBITDA margin. Focusing on lifting the margin to 15% adds about $1.50.
