Its goodwill from the initial business combination; split between two cash generating units (5 mill to EGL pollution control and 4 mill to EGL Gas turbine). Goodwill + Assets = Projected CGU Recoverable Value (which is estimated by management).
Anyone know where the 2.4 mill of contingent liabilities come from? I had a quick read through two annual reports but couldn't find what I was looking for. Accounting seems very creative (M-Test points to manipulation) probably encouraged by 10%/15% PBT bonuses.
Effectively cutting costs and getting some of those margins back would lead to a happy ending turnaround story. Worth watching to see how badly sellers want out.
EGL Price at posting:
1.8¢ Sentiment: None Disclosure: Not Held
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