solid volume, page-2

Hi all, been a while since my last post though still been following the success story.

Lets revisit some numbers...

FY10 EBITDA (approx.) $22m. Lets adopt FY11 EBITDA of $22m plus 20% so $26.5 plus 20% EBITDA on $12m revenue for IPS, another $2.5m, provides for circa $27m.

Cash (minus IPS acquisition) say, $10m.

EBITDA multiple commonly used in this sector by analysts is 6 times.

FY11 EBITDA of $27m x 6 = $162m
Cash = $10m

Investment in IIN = approx. 23% x $425m x 90% (discounted by 10% to market price) = $88m.

Total Value of Business (no debt) = $162 + $10m + $88m = $260m.

Shares on Issue (710 million, accounting for an additional 4m for IPS).

Company Value / Share = $260m/710 = 36.6 cents.

I think the company is fully valued at current levels. Unless IIN increases significantly or AMM's growth surpassess that forecasted, i'm not sure if we'll see 40c + for some time. Great buying under 30 cents. Safe buying at current levels for longer term holders.

I do not hold shares - happy for comments on my crude numbers.