SargeI agree in general with your comments - There may be a...

Sarge

I agree in general with your comments - There may be a couple of other 'buffers' that CUS could have up its sleeve.

(1) CUS paid $6.584 million for Baliment interest (interest on cash held in machines) in the year ended 30 June 2008. This is being charged at 30 day bank bill swap rate plus a margin of 0.65% to 0.85% per their annual report. The 30 day bank bill swap rate has dropped dramatically since then. At 30 June it was 7.54%, at October it was 6.20% and in todays AFR it was quoted at 4.70%. All in all one would expect to see a big drop in baliment interest costs based on these reductions.

(2) I estimated capex spend for 2008/2009 at A$7-$8M - say $2M per quarter. If it was stuck I would have thought CUS could cut back/postpone some of this capex spend if required.

(3) I was expecting CUS to get some savings (circa 3 cents per transaction) from rolling out a mobile network around Oct 2008. On 80 million transactions per annum this would amount to circa $600K per quarter.

(4) I dont think the main shareholders in CUS - Hunter Hall with 232M Shares, FCP Brencorp with 133M shares and Bendigo Bank with 117M shares would leave CUS stuck for a couple of hundred grand, (thats if CUS needed any cash at all) when direct charging is so close.

(5) CUS said at its AGM address that it was in advanced discusions to sell another 14% odd in SPS to another party(it has already done a deal with Bendigo for $5M for circa 14% of its 33% holding and looks like it will keep the balance of 5%).

(6) In the 12 Nov 2008 opening briefing posted on the ASX, Tim Wildash indicated that YTD their transaction numbers were growing.

(6) ANZ and Suncorp have both already posted announcements on their websites indicating to their customers that they expect direct charging to commence on 3 March 2009 as planned.