balance sheet

I have made a point not to comment on the balance sheet(for good reason ie; experience). But putting TA aside as an explanation for the recent rise the balance sheet and prospects for growth and increased profit margins appear inevitable.

Revenue is growing whilst the company expects $180million to boost its coffers ( better late than never) plus a very sexy assett vs liabilities the former more than double the latter (current).
What is there not to like?

On top of that most projects are near completion that spells strong profits over the next 3-4 years. Without sticking my neck out $25-$30 million net would be conservative. Given that cash burn has been reeled in and the current management team has restored credibility (some could argue against) $50 million is not over the top. With approx 1.1billion shares on issue (in due course)$25million net @ per of 20 = .50c per share. That is conservative.

Westpac with due diligence has decided the time is right that in itself should give most holders confidence.

I have not mentioned the bigger picture but it is only a matter of time before ERG receives revenues in excess of their previous highs. Again when projects are completed value adding can only propel the sp one way and that is ofcourse up. $250million is conservative but up significantly compared to 2006.Profit margins should rise Iam factoring in 12%-15%.

Looking forward to the next half yearly!!

cheers,
walt.