"The diluted earnings per share is calculated after allowing for the
35,540,000 Warrants issued on the 8th May 2001 and not converted at 31st
December 2005. Each Warrant entitles its holder to subscribe for one New
Ordinary Share at a price of 5p per share up to 30th April 2011."
If warrant holders subscribed today Co would have £1.775m more cash so Capn might rise from todays £17.55m to £19.32m,but shares in issue would increase from 130m to 165.5m. So share price might be expected to drop by 13.5% from 13.5p to 11.67p
If warrant holders subscribe when share price is 27p Co would have £1.775m more cash so Capn might rise from £35.10m to £36.875m,but shares in issue would increase from 130m to 165.5m. So share price might be expected to drop by 18.5% from 27p to 22p.
In other words the warrants can be expected to put a steadily increasing brake on growth in the share price
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