I think some items of interest you have raised and will play out...

I think some items of interest you have raised and will play out over coming years, some good items to keep an eye on in any future financial reports. I agree with you that it can be difficult to know how much of the grouped acquisition costs are truely one offs, obviously we can assign some portion, however some of the categories are quite large and broad descriptions, particularly the outlet rationalisation and brand system alignment, where it is difficult to know the detail without being the actual management. Also large acquisitions have been predominately debt funded so we need to see the debt reduction strategy or future acquisitions/cap-ex to include some reinvestment of cash available after dividends. Personally I would like to see this occur through dividends held steady (rather than increasing) and a dividend policy before these increase (a debt to equity or similar target or a targeted percentage of profits - say 50 per cent of npat). The level of cash absorbtion required for growth in working capital does not seem too high to me, generally when a business acquires a new business the outflow from increased working capital will be immediate (stripping out any seasonality depending on the type of business/industry) whereas the profits will accrue over time, so the difference between the working capital outflow and profit generation will be gradual and it will also be a slower gap to close if the underlying business is also growing putting further pressure on this. Good management will have an ongoing focus on these areas. At this stage I still see as a growth business and can't see major problems with cash flow, however will keep an ongoing watch on this, as well as debt levels and managements policy and plans to manage this. Thanks for your thoughts, I appreciate the thoughts of people that take the time to look at the detail and make their own views.