 |
|
Here is the math
Posted on: May 16, 2019 at 15:33:08 CT
BigDave MU
Posts:
7062
Member For:
24.71 yrs
Level:
User
M.O.B. Votes:
0
Let's say the new capital asset costs $100 million. If you depreciate that over 40 years, the annual cost would be $2.5 million per year. If the new revenue generated by the SEZ is $6 million per year as has been reported, that would result in a new gain for the year of $3.5 million (all other things being equal). If you only have a $1.8 million loss, and additional $3.5 million of profit will net out to a $1.7 million gain.
I didn't factor in the interest cost on the new debt for the SEZ because I don't know what it is. I think they are only financing a fairly small porting of the cost, $25 million from memory? At 3.5% interest that would only be around $875,000, so it will take up a good chunk of the profit, but probably would still be a net positive or very close.
I didn't factor in the interest cost on the new debt for the SEZ because I don't know what it is. I think they are only financing a fairly small porting of the cost, $25 million from memory? At 3.5% interest that would only be around $875,000, so it will take up a good chunk of the profit, but probably would still be a net positive or very close.
Please explain why this message is being reported.
MESSAGE THREAD
- 
Here is the math - BigDave MU - 5/16 15:33:08