Normalised Five Year Earnings History: 2018 perspective
Quote:
Originally Posted by
Snoopy
Five Year History of Turners Limited: Operational NPAT
|
FY2012 |
FY2013 |
FY2014 |
FY2015 |
FY2016 |
EBIT (Turners Auctions :TUA) |
$7.342m |
$7.948m |
$9.117m |
|
|
less TUA Liabilities x TNR Interest |
$33.272m x 0.12 = ($3.993m) |
$36.423m x 0.098 = ($3.570m) |
$45.634 x 0.151= ($6.891m) |
|
|
equals EBT (Turners Auctions) |
$3.955m |
$4.378m |
$2.226m |
|
|
add EBT (Dorchester) |
($1.543m) |
($0.133m) |
$4.892m |
|
|
EBIT (Turners Limited) |
|
|
|
$26.387m |
$32.987m |
|
EBIT (Turners Auctions) |
|
|
|
$5.829m(*) |
|
|
add back Turners Auctions acquisition costs |
|
|
|
$0.675m |
|
|
Interest Expense (Turners Limited) |
|
|
|
($7.381m) |
($11.436m) |
|
less tax paid equity accounted TUA income |
|
|
($0.721m) |
($0.742m) |
|
less one off paper gain self-caused by TUA takeover |
|
|
|
($7.098m) |
|
equals EBT (DPC+TUA) |
$2.412m |
$4.245m |
$6.397m |
$17.670m |
$21.551m |
less tax at 28% |
($0.675m) |
($1.189m) |
($1.791m) |
($4.948m) |
($6.034m) |
equals NPAT (DPC+TUA) |
$1.737m |
$3.056m |
$4.606m |
$12.722m |
$15.517m |
----------
(*) 'Turners Auctions' was absorbed into 'Turners Limited' on 20th November 2014. This was during the FY2015 Turners Limited financial year which ended on 31st March 2015. Turners Limited FY2015 contained 365 days. For 234 of those days from 1st April 2014, 'Turners Auctions' was an equity accounted investment. Note 18 in Turners Limited AR2015 shows an equity accounted contribution to profit of $0.742m up until 20-11-2014. If we annualise this contribution, assuming a constant earnings rate throughout the year, then we get an annual earnings contribution from this 19.85% strategic stake in TUA of:
$0.742 x 365/234 = $1.157m (EBIT) for that 19.85% stake
This means that 100% of TUA must be making an EBIT of:
$1.157m / 0.1985 = $5.829m
|
FY2014 |
FY2015 |
FY2016 |
FY2017 |
FY2018 |
EBIT (Turners Auctions :TUA) |
$9.117m |
|
|
less TUA Liabilities x TNR Interest |
$45.634 x 0.151= ($6.891m) |
|
|
equals EBT (Turners Auctions) |
$2.226m |
|
|
add EBT (Dorchester) |
$4.892m |
|
|
EBIT (Turners Automotive Group) |
|
$25.645m |
$32.987m |
$35.981m |
$45.477m |
EBIT (Turners Auctions) |
|
$5.829m(*) |
|
|
add back Turners Auctions acquisition costs |
|
$0.675m |
|
|
Interest Expense (Turners Automotive Group) |
|
($7.381m) |
($11.436m) |
($11.350m) |
($14.344m) |
less tax paid equity accounted TUA income |
($0.721m) |
($0.742m) |
|
less foreign exchange gain |
($1.087m) |
|
|
less one off paper gain self-caused by TUA takeover |
|
($7.058m) |
|
less revaluation gain on investments and PPE sale |
|
($0.010m) |
($0.270m) |
($1.313m) |
($1.000m) (e) |
equals EBT (DPC+TUA) |
$5.310m |
$16.958m |
$21.281m |
$23.318m |
$30.133m |
less tax at 28% |
($1.487m) |
($4.748m) |
($5.949m) |
($6.529m) |
($8.437m) |
equals NPAT (DPC+TUA) |
$3.823m |
$12.210m |
$15.332m |
$16.789m |
$21.696m |
----------
Notes
1/ (*) 'Turners Auctions' was absorbed into 'Turners Limited' on 20th November 2014. This was during the FY2015 Turners Limited financial year which ended on 31st March 2015. Turners Limited FY2015 contained 365 days. For 234 of those days from 1st April 2014, 'Turners Auctions' was an equity accounted investment. Note 18 in Turners Limited AR2015 shows an equity accounted contribution to profit of $0.742m up until 20-11-2014. If we annualise this contribution, assuming a constant earnings rate throughout the year, then we get an annual earnings contribution from this 19.85% strategic stake in TUA of:
$0.742 x 365/234 = $1.157m (EBIT) for that 19.85% stake
This means that 100% of TUA must be making an EBIT of:
$1.157m / 0.1985 = $5.829m
2/ Eagle eyed table readers will notice that I have moved the one off gain from the full takeover of Turners Auctions in FY2015 from being a taxable to a non-taxable gain.
3/ (e) is a preliminary estimate
SNOOPY
Normalised Five Year EPS History: 2018 perspective
|
FY2014 |
FY2015 |
FY2016 |
FY2017 |
FY2018 |
NPAT {A} |
$3.823m |
$12.210m |
$15.332m |
$16.789m |
$21.696m |
Shares on Issue EOFY{B} |
55.966m |
63.077m |
63.432m |
74.524m |
84.803m |
Earnings Per Share {A}/{B} |
6.8cps |
19.4cps |
24.2cps |
22.5cps |
25.6cps |
In the past I have used a capitalised dividend valuation method to value TRA. However, given the strong retained earnings element within Turners Automotive Group, I now consider this method sub-optimal in terms of assessing the value of the company. Instead I will look to do a capitalized earnings valuation, based on the above data.
SNOOPY