Lets be clear. Firstly they issued the forecast of $83-85m, (mid point $84m for FY21) at the same time as announcing their FY20 result (which was impacted by the Covid overlay). I see this as their core current year earnings unsullied by any one off Covid or Harmoney items.
The fact that subsequently they are talking about not needing earlier Covid provisioning taken in FY20 based on evidence to date suggests a partial of full reversal of this provisioning on top of earlier guidance of $84m, (total could be over $90m inclusive of full reversal of FY20 provisioning plus any upgrade of current year forecast). i.e. $90m for full year, (3 x $29.9m) plus reversal of previous over provisioning for Covid plus possible Harmoney one-off.
Some commentators maintain that the economic ramifications of the pandemic are yet to be
fully felt, and due to this remaining uncertainty, and despite running ahead of the forecast run
rate, we don’t propose currently to change the current NPAT guidance of $83 million to $85
million for FY21.
My interpretation of this is that they are acknowledging that the $29.9m core operating earnings for the 4 months to 31/10/20, (annualized run rate of ~ $90m), is currently ahead of forecast but they are effectively saying that because the effects of the pandemic may not be fully felt yet they are leaving their core earnings at $84m forecast as is for the present time. This certainly does not preclude them from raising it later this financial year.
I share your cynicism about proactive provisioning and suspect core operating earnings for the year will meet forecast and be about 14.4 cps and I think a fair Covid recovery PE going forward is in the range of 15-16 so am sticking with my target of $2.30. I think the dividends will be about 11 cps fully imputed once the RBNZ restrictions come off so that's 11 / 0.72 = 15.28 cps gross and on $1.63 gives a prospective FY22 yield of 9.4% gross. Just a "little" better than their term deposit rates ;)
Hopefully this post clarifies my thinking of how this all fits together.