I had a briefing with management post results. My take is as...

I had a briefing with management post results. My take is as follows;

1. Balance sheet stabilised, but gearing remains too high (albeit much lower than once was). Hence I feel that they are likely to apply surplus cashflow to debt reduction rather than do share buyback.
2. Have $16m cash (with Mirvac loan outstandings at circa $9m), but will not likely repay Mirvac loan until they have finalised their capex budget, so that they can maintain a prudent cash balance buffer. They noted that some capex was placed on hold over past 2 years whilst they focused on liquidity and debt refinancing - now see capex of some $4m as necessary.
3. Now they have debt set or repaid the board will review strategic options going forward. Asked and was advised that this would not include growing the property portfolio.
4. Interestingly the 0.5% management fee now barely covers cost of management team, thus Mirvac no longer making profit out of this. Thus no growth then this becomes marginal to loss making for Mirvac. Confirmed that Mirvac no longer have any overseas aspirations.
5. That earnings are circa $6.5m per annum, and cashflow pretty close to same.
6. That with debt set these portfolios become a more marketable / better sale proposition.
7. That there has been such churn to the share register that most shareholders now have a low entry price, and thus shareholders will likely be receptive to an offer.

I firmly believe that they will seek to sell this company, or its assets, and return proceeds to shareholders. I have a 12 month horizon on this and hope that we can get circa 20 cents per share.

Note that the AUD falling from 1.07USD to 1.02AUD improves our NTA from 17.0 cents to 17.8 cents. Lets hope the AUD tanks!