I don't think that you are looking at the full picture here. The appendix contains a solid breakdown of the full impacts to PBT. The $7.4m reversal doesn't fall straight to the bottom line.
In any case, the acquired business met the TNE business case targets but failed to meet the sellers self-imposed targets in order to earn the earn-out. This should actually be seen as a great outcome for TNE as there would never be a set of circumstances where "nothing happens" scenario comes to fruition - either the earn-out is paid because targets are met (and we get drained of ~$7.4m in cash) or the earn out is not met and the accounting entries get reversed with nil cash impact - as has happened. I know which one I would prefer.
TNE Price at posting:
$15.51 Sentiment: Buy Disclosure: Held
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