Ann: 2021 Half Year Results Presentation, page-10

@niceaussieguy,

I think you've got to 97.5% of the answer in 2.5% of the time.

The single biggest valuation variable is clearly that $300m liabilities payable number (I'm assuming by that you mean the legal claims that are currently sub judice).

Experience has taught me that often those sorts of claims are made on an ambit nature and that the final settlement amounts are usually materially lower than the initial ambit claims.

If you repeat your exercise based on a scenario whereby the settlement amounts are, say, "merely" $150m. In that case the upside is between 2 and 3 bags.

But it is a quite binary investment proposition:

Either the legal claims:

1.) aren't all they seem and the stock doubles (the market animal in me says 60% probability),

or

2.) in large part, need to be serviced in which case we are probably talking about something like a 1 for 2 emergency re-capitalisation at a price somewhere close to, I dunno, $2.50/share (40% probability)

So,

60% chance of doubling my money or 40% chance of me losing 30%.

=> ~50% prob. weighted return.

Which is why I have taken a shareholding position in the stock (with modest portfolio sizing reflecting anticipation that I might have the opportunity to participate in a recapitalisation exercise at an ever greater valuation discount at some point over the next 6-12 months.)

Make no mistake - this is one for the brave hearts.

Using a high board diving analogy, it is commencing with handstand, a triple backward somersault, with double twist plus pike and tuck - into a drum of water, making no splash.

Degree of difficulty - Acute.
But if it can be pulled off, the judges will score it very highly.

.