BSA: I started looking at this one when it was 30 cents and now...

BSA: I started looking at this one when it was 30 cents and now it is 21.5 cents it is even more enticing however I was wondering what made me turn it down when it was trading at PE 7 or 8 ... so I looked through it again and I see that HY10 eps is up 57% Revenues per share are up approx 30%. Then FY10 eps were up 11% and Revenues up again about 30% per share. So it all looked good to me on the surface but there was a reason I didn't buy. For HY10 I looked at Profits before tax and I realised that they only paid 2% in tax when they usually pay 25%, Profits before tax were up 29% and eps was up 57% (should have been up about 29% or less) the extra 28% was from the tax advantage.For FY10 Profit before tax went down by 24% that year yet the eps went up 11% because their NPAT was 14% higher than their pretax profit because of a one off tax benefit of $1.1M where as in the previous corresponding period they paid 28% in tax as opposed to getting paid 14% extra from the tax office. HY09 eps where down 46% and Revenues up 12% and that was with normal tax for both periods. But saying that they have a reasonable balance sheet and are cheap at PE 5 but I still want to check out the next results I'm thinking they will either be flat or even go down maybe this new CEO can do a good job, but I want more proof.

All my posts represent my personal views only.