was on holidays when the report was released so have only had...

was on holidays when the report was released so have only had the chance to chew over the report properly in the last day or two. what a fantastic result. Increase in EPS of 42% whilst also moving to a full tax paying entity. FY10/11 also looks very bright as well, as many other posters have pointed out. My observations about expectations for this financial year:
* The directors have pointed out that NTT has already placed its first fixed wireless service order with BGL in Sydney and other deals with international carries are expected in coming months. This shows that future organic growth expectations are VERY REAL (see directors report).
*The directors have also pointed out that customer orders have been recieved to expand network coverage in Newcastle and the Sunshine Coast. Again this is organic growth already lined up (see directors report).
* WIZZ and Star Tech Acquisition will also drive growth this year. Check out Note 29 of the full year report. Profit of $73,000 was recognised for WIZZ in the last quarter. So for 10/11 we can bank on an extra 220,000 in profit being received on account of a full year of WIZZ revenues/profits. Assuming that BGL can achieve the same R.O.A of approx 18.5% on star-tech then we could expect a further 100,000 to be added. On my rough back of the envelope calculations, we are looking at, with these two contributions, EPS of close to $.021 per share WITHOUT TAKING INTO ACCOUNT ORGANIC GROWTH!!!
* The great thing about the BGL business is the scale benefits. If the company can manage further organic growth (WHICH IT MOST CERTAINLY WILL AS SEEN ABOVE), it should be able to achieve this on fairly similar cost structure to 09/10. In that case if organically the company can grow revenue of say 10%+ (and the directors state in their report that "with the momentum generated in FY10 the Company is confident of achieving continued double digit earnings growth in the new financial year") that will translate into a much greater increase in earnings (all things being equal).
* Consolidation: there appear to be a number of opportunities out there for BGL. The biggest is a CVA takeover. We should find out more about that opportunity once CVA release their full year results. The directors have also suggested that BGL is in the box seat to lead further consolidation of the fixed wireless industry. On that basis further acquisitions this year should be expected. The directors suggest acquisitions may be funded by further equity issues, and as long as the issues are EPS accretive then all good (although cash and debt would supercharge any increase in earnings, although cash needs to be preserved for further P&E investment). BGL management have been asute in the recent acquisition in a number of ways including acquiring businesses at under 3 x EBITDA, whilst BGL is trading on 5.5 x EBITDA, whilst also de-risking acquisitions somewhat by structuring earnout arrangements. Obviously if BGL is acquiring at under 3 times EBITDA, immediate value is recognised if the market ascribes a BGL group value of 5.5 x EBITDA.

So I think the BGL earnings profile for this year looks very bright indeed. To me BGL is an appealing investment prospect not just for its near term earnings profile. Other positives include a pristine balance sheet, strong cashflows, exceelent R.O.E, properly aligned management (the CEO and CFO/COO have strong equity interests in the company). The only risks I see come from the size and scale of the business and the possible impacts from the NBN (regardless of whether it is a liberal or labour policy) - althought a hung parliament is surely going to only exacerbate any lead time in actually establishing a network.

All in all in my veiw BGL is a STRONG BUY!!!