Disagree with you on this one stock analysis guru, however...

Disagree with you on this one stock analysis guru, however always open to new opinions and analysis as it helps to understand others thoughts and viewpoints. I agree that cashflow analysis is very important and that a comparison between reported cash flows and profits must always be looked at to ensure that accrued profits are actually being received as cash. It can be a warning sign if this does not happen, however reduced cash conversion can also be positive if it is due to growth in the business, we just have to determine which is the case. I believe that in this case it is due to a growing business. Refer to note 7 of the 2015 financials which shows the net profit to cash flow reconciliation. Of particular note is that due to the major acquisitions in the period the business incurred major non recurring expenses including 17.1m in acquisition costs which will not recur going forward, hence the management analysis of actual reported eps per share vs underlying. Of further note in the year prior (fy2014) there was approx $8m in cash flow absorbed due to working capital requirements (the net movements in inventory, payables and receivable positions) which reinforces my view that this is a growing business and the cash flow position reflects this. On a side note you are incorrect in deducting the full plant and equipment cash spend as this exceeded the accrual depreciation expense. I would allocate the portion relating to depreciation as the cash flow expense with the remainder correctly reflecting capital investment by the business, which although still an outflow is an investment in the future and a driver of future earnings.