How to build an enterprise value model for PLAN - 4Step 4
While this analysis necessarily makes some best guess allocation assumptions as I lack access to the actual levels of administration and support each component consumes, it does provide an interesting picture of the relative performance and hence contribution of each of PLAN's current business components.
If the legacy business acquired under the APL acquisition was a stand alone operation it would have recorded a $829,834 quarterly net profit on its $8,964,623 shareholder equity allocation. If that quarterly performance is maintained throughout the remaining 3 quarters, an annual profit of $3,319,336 would be achieved which is a very commendable 37% return on equity deployed.
As we have witnessed over the last 8 quarters, the remaining 5 components consume just over $5 million in equity and consistently produce losses. In Q1 2025 these losses amounted to $456,470, or a negative 9% return on equity. If these losses persist over the next 3 quarters, that is magnified to a negative 36% loss on equity deployed.
That being said, we have seen management working to reduce the burden of the 5 "ancillary" components in draining the success of the legacy APL business. Shareholders wishing to secure and enjoy shareholder value creation from the recent 8.5 cents per share the market had assigned to PLAN's common equity, as opposed to the past 30 months of shareholder value destruction as the shares fell from 40 cents to below book value must, I believe, continue to closely monitor the current management team and leadership, and so encourage the continuation of their recent turn around efforts.