I have problem with this excercise, i dont know exactly how to deal with these trailing and leading ratios. Can anybody help me?

Trailing (historical) P/E - based on EPS of last four quarters (TTM).

Forward (leading) P/E - based on EPS forcasting to the end of CY.

You need to calculate your own Earnings, EBITDA or Book Value in order to obtain the price or the EV. Nota that number of shares outstanding is not given, so asume P/E is not in a per share basis.

Start with trailing Earnings: 3.0, so P = 3 x 10 = 30

Then Leading Earnings: 3.0 x (1.1) which is 10% expected earnings growth, so P = 3.3 * 8.5 = 28.05

Then trailing EBITDA: ebitda is 8% of sales, so first calculate sales, you got net profit margin of 6% last year, so the trailing sales are 3.0 / 0.06 = 50, then calculate trailing ebitda as 50 x 0.08 = 4. So EV = 4 x 9 = 36 million

Forward EBITDA will be 4 x (1.1) = 4.4, because the expected sales growth rate per year of 10%. EV = 4.4 x 8 = 35.2

The Book Value (BV) is 15 - 1 = 14, so P = 14 x 1.5 = 21

Hope this helps!

Harrogath - thank you for your help! You’re my hero today

You are welcome

One more question to that, should’nt we take as earning 2,7? Because 3 are with this one-off transaction, which is 0.3.

I stopped on that a little bit too. One-off transaction means a one-time transaction that is not a regular transaction of the business, so the earnings should be adjusted for it. However, we don’t know if it is a sale or an expense. If it was a sale, we should calculate earnings as 3 - 0.3 = 2.7 million. If it was an expense, then earnings would have been 3 + 0.3 = 3.3. The note does not specify what kind of transaction it was, so I decided to “believe” those 3 million are already adjusted for that one-off transaction and use 3 million as net income from continuing operations.

Hope this clarifies enough.