Go you good thing, page-14

Every time I read the announcement I want to dip in and buy more shares. If you read the announcement not knowing that it was Ashley, you would thing the cap of this company must be around $50m+ (given EBIT and multiple).

Dividend
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What I take from the announcement was that there were approximately $3m of real cash costs associated with the restructure/rectification that are non recurring. With this excess cash saving alone the company can afford to pay out a 2 cent dividend (nice return of 15 % assuming not franked). The company's cashflow reported for FY 17 was a net inflow of $3.1m, presumably with a reduction in head office costs for FY 18 and improved margins for FY 18 we should be able to achieve cash inflow of $7m ($3m saving above plus $4m from ongoing). EBIT is good but cashflow is king.

Training
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A bit of a gem in the results was the training division. It is now a slimmed down business unit and achieving great numbers (EBITDA $2.9m) even after a hell of a year. I can only expect this to improve in FY 18. If they manage to snag a government contract for training, this stock will rocket. Commentators on HC have indicated it is highly unlikely given the reputation, however, I believe that if they can get any traction in this market then it should drop straight to the bottom line given the initiatives in FY 17. The stock will fly if it can get a decent contract.

Labor Hire
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Labor Hire is a tight margin business, but I am impressed by the margin increase of 35%. Sure it has only gone from 2% to 2.7%, but on high turnover business this makes a difference. The company's announcement indicated 'growing momentum as new contract wins ramp up'. I can only assume there are more wins coming through the pipeline.

DYOR as this is my view only.