re: Ann: Establishment of Multicurrency Debt ... simple. I have...

re: Ann: Establishment of Multicurrency Debt ... simple. I have CY15 EBIT well above consensus at 162m, and CY15 NPAT @ 83m, below consensus. the difference there is made up of interest expense. (Nb - I am extrapolating occupancy of 84%, if you play with that figure you can make the model say whatever you want). Same EBIT margin, compression on net margin (again consistent with gearing up).

Working backwards from there, to keep the interest cover ratio above 3.5, i need to fund a heap more acquisitions without adding to debt. 440m is backed out of the model to keep TICR at comfort level, assuming dividend payout ratio is 100% and company is tapped out on debt.

Assumes purchases @ 5x EBIT and an interest rate of 7.5%. As I built the model, I have the pleasure of making whatever assumptions I want! 7.5% is probably being tough and this is reflected in broker estimates (i.e. dilution will be less than my estimates, EPS will beat me) but i think the days of 4x EBIT purchases are over. (that's real EBIT not 18 month forward...).

clearly, models are extremely flawed:- my point is simply that the company is almost fully leveraged and cannot gear up much more. That spells an end to the debt fuelled buying spree of the last 12 months. any incremental purchases will have less of an effect on SP/EPS/DPS than those of the last 12 months.