The result was pretty poor.

Lots of murky moving parts. The saving grace is the starting point for the balance sheet. If things go awry for a half or two, and you’ve got a strong BS, you tend to weasel through. ND/EBITDA moves to 1 given negative cashflows over the half.


The stock now looks cheap post the shellacking, particularly relative to sector, on regression to fundamentals.


And stands out on the trade off between Quality and Value.


The rebased earnings profile looks much more realistic. Note the graph below, with the short dashed red line indicating prior consensus (a thumping d/grade).


The new required earnings trajectory (below graph) looks much more achievable.


And headline multiples (e.g. P/B) close to lows.


We will hold our position, giving the stock the longer run benefit of the doubt.

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