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joewolf

5,668 Posts.

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29/02/16

15:11

Post #: 17144451
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Originally posted by Pioupiou ↑

PinchOfSalt

As the quantum of the insurance payout was unknown when the accounts were published, the insurance claim was simply ignored in H2FY16. The $2.5m agreed to and received will be accounted for in H2FY16.

The two matters, insurance and the hard rock contract variation still under negotiation were said to have impacted H1FY16 NPAT by $6.3m, which translates to $6.3m/.7 = $9m. We can thus infer that the hard-rock matter has a value of $6.5m before tax. The expense incurred has been picked up in the usual way (something along the lines of debit expense, credit cash). I doubt if any revenue provision was made in H1FY16, so whatever is agreed should also be accounted for in H2FY16.

The worst-case outcome is that BYL only gets the $2.5m insurance, and the best-case outcome is that it also gets agreement for $6.5m hard-rock claim. Hence, the two matters should impact H2FY16 as follows:

Revenue ............................. $2.5m - $9.0m range
Profit before tax ................ $2.5m - $9.0m range
NPAT ................................ $1.75m - $6.3m range
Intrinsic value per share ........ 1.4c - 5c range (there are 126.5m shares)

The hard-rock matter is under negotiation, and BYL is supplying whatever is being requested to support its claim – business as usual for Civil Works contracts.

I would be happy to be corrected on the foregoing. A good outcome of the hard-rock matter should give the SP a fillip.

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Sorry dont agree:

Form January Update:

"Diversified contractor Brierty Limited (ASX: BYL) wishes to advise it has finalised weather related insurance matters encountered during the construction of a completed Main Roads Western Australia project with recoveries totaling $2.5M. These funds have now been received in full and will be recognised in the results for the first half of the 2016 financial year"

However I dont think it was carried at NIL :

I made this post earlier :

http://hotcopper.com.au/posts/17102245/single

I suspected that as the insurer had accepted that there was a claim that those costs which were "recorded " in the 2015 afs may well have been accrued as an asset. however no auditor would allow you to accrue for profit on a project in dispute.

It would be good to have your thoughts on my view.

BYL Price at posting: 18.0¢ Sentiment: None Disclosure: Held
3 Upvote

0 Great analysis

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