Roy Hill disaster, page-5

Hi Guys

Just to add to what Beardy and PB are saying...

The company has admitted that they can't tell investors what the loss on the contract is because it is CIC - they say this in in report. There's enough info in there though to take a pretty good guess though what it is.

On page 7 of the Director's Report they state that the EBIT loss for the Civil and Mining division for the year was $126.5m excluding impairments. If you assume that the rest of the C&M division broke even for the year (and it probably made a profit) and that about $25m was the write back of profits from the 2014 year you are still looking at a $100m loss on this contract (approx).

As to the receivables it is very vague and I interpret it a few ways. One way I agree with PB but there are other ways to interpret it too.

We do know though that total receivables at year end are $73.8m so the amount owing can't be more than that. Considering that will include other debtors such as the Samsung concrete package, drill and blast contracts, Middlemount etc it obviously far less than this.

To go one step further we can go to notes 12 and 22 which point out there was $37.7m relating to construction work in progress. Again some of that presumably relates to the Samsung concrete package and potentially other minor works that they were doing at 30 June.

This is all based on a likely final contract price. However I expect that will be very conservative. The auditors aren't going to sign off anything that they aren't essentially sure the company will get in so would think there is a fair bit of upside in any final settlement - the question is how much?