The management at Fortescue are considering an on-market share buy-back over the coming financial year. Post buy-back the firms ROE is expected to be 12.5% and ROCE is expected to be 16%. The book value of the equity is $8 million and the firm intends to buy-back 15% of its shares. The number of shares outstanding is 1.2 million and the market price is $5 per share. The buy-back is likely to be funded by debt. Assuming the after-tax cost of debt is 5%, calculate the EPS post-buy-back and discuss whether the company should or should not carry on with this buy-back.