I had planned a more modest thread title but even my unbridled...

I had planned a more modest thread title but even my unbridled enthusiasm for BRS in FY16 and the yr ahead has been exceeded! A brief summary with more detail in next post:

1H16 EBITDA (underlying) 124.7m UP 11.1%
1H16 EBITDA 119.6m UP 21.7%
1H16 NPAT (underlying) 27.9m UP 54%
1H16 NPAT 25.1m UP 197%
profit to shareholders UP 202%
1H16 eps 4.9c
1H16 net Debt 460m DOWN 109m
1H16 Debt DOWN 19.1%
Net Debt/EBITDA 1.7x
Gearing 36% down 16.3%

Very strong 1st half and everything on target/ahead of target re 2H16. Best of all BRS have indicated Fy17 will be even stronger and dividends should ramp up considerably esp as:
a) Debt reduces
b) interest rates reduce
This makes future interest payments a fraction of earnings and (imo) warrants a change of focus from debt reduction to supporting the SP via a buyback. DONE at 10%. We don't want to kill off chance of a higher TO offer but with fundamentals so strong no incentive to accept $1.35.

Its clear the Ferrovial offer was well timed. It caught BRS SP in a downward spiral from constant stream of adverse propaganda from a small but vocal group protesting the treatment of asylum seekers at Nauru and Manus island. Plus short selling accentuated the fall to well under 90c making the TO appear very attractive, But Ferrivial continually moved goalposts/hedged their bets with various T&Cs in the offer causing Mkt to not take it seriously.

I feel BRS should ignore the TO and press ahead with winning the DIBP contract, make even more strides re productivity, and ensure current contracts stay with company when up for renewal. Re-introduction of divs will also make stk attractive to a wider base of investors. Main negative is that contract margins remain under pressure. But BRS is in a far stronger position than just 18 months ago and should prosper going fwd.

BEST news of all is that net earnings/profits now spread across a far wider base than last yr. Plus the EPS in 2H16 will be significantly higher as less profit poured into debt reduction as interest accrued has dropped so much.

Can SP reach $1.35 under its own steam? I think it can.