Firstly gunns dont intend to spend 2bn. The project is 2bn of...

Firstly gunns dont intend to spend 2bn. The project is 2bn of which they intend to sell a 49% equity stake. Secondly the uumber you would want to compare it to is its market capitalization (400m), stocks trade on PE ratios not on Earnings to investment ratios. Thats a 66% increase in EBIT. Also you have to consider the fact that they arent going to breach any covenants at the end of the financial yearh, an important factor as lets face it this company was/is in trouble however is trading well below book value so if they can sell down assets they should be alright. This extends that time frame.

Realistically 1 month ago gunns was reeling and fighting for survival. I think this announcement confirms it will survive, atleast in the near term, and is on the road to turning things around.