Narla,Hmm, OK, good points. 2008 whole year EBITDA was $356m....

Narla,

Hmm, OK, good points. 2008 whole year EBITDA was $356m. First half 2008 EBITDA was $223m, so second half was $133m.

Assuming a projected $132m EBITDA for the entire 2009 financial year and that they expect to earn that equally throughout the year, first half 2009 EBITDA might be $66m. Add that to the $133m 2nd half 08 and you get $199m (say, $200m) for the 12 months to 30 June 09. $200m x 3.75 = $750m. That's what their debt would need to be below before 30 June.

Also, bear in mind that if 2008 EBITDA was $356m and 2009 ends up being $132m (mid-point of management's range), that's a +60% slide in EBITDA, which is outside their planning scenarios.

Let's look at management's best case, full year EBITDA scenario of 35% revenue slide and 13% EBITDA. We would have revenue of $1.839bn x 65% = $1.195bn x 13% = $155m EBITDA.

That would require net debt to be reduced to $133m + ($155m/2) = $210m * 3.75 = $787m by 30 June 09. A $10m reduction in borrowings vs. a $50m reduction in the next 70 days looks more doable, but you're more confident than me, if you consider it to be well in hand.