BBR Holdings Investing Thesis Addendum

An acquaintance has expertly pointed out an inaccuracy in my projections for lakelife EC project, and I’ve amended the figures accordingly. Basically, I’ve neglected to account for taxes to be paid for the project (nobody can tell the taxes, I’ve just assumed a 20% rate), and the loans to be repaid by the JV to BBR.

So let me just do the consolidated figures again here:

Breakeven price $727 psf

Selling price $873 psf

Estimated profit $(873-727) x 653,000 = $95.3mil (Assuming fully sold)

Net profit after tax = $76.24mil (It is impossible to predict accurately the tax, I’d just assumed 20% which is on the high side to provide a MOS)

After repayment of loans to shareholders = $76.24mil – $19.3mil = $56.94mil.

BBR’s 35% stake = $19.9mil or 6.5cents/share

This means upon TOP, BBR’s income statement will show a nice boost to earnings of approximately 6.5 cents, and the balance sheet will have a mega boost to cash and cash equivalents of ($19.9 mil due to it’s 35% stake + $19.3mil due to loans extended to the JV) = $39mil approximately.

Advertisements

2 comments

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s