The Lemon Fool

Very exciting...but what about the dividend?


https://www.londonstockexchange.com/exc ... 51057.html

Some discussion on the shares board.

viewtopic.php?p=311047#p311047

monabri wrote:Very exciting...but what about the dividend?


https://www.londonstockexchange.com/exc ... 51057.html

Some discussion on the shares board.

viewtopic.php?p=311047#p311047

You wouldn't expect anything on Marstons dividend on an announcement like this.

You do get the news of what the Joint Venture's Dividend Policy is though.

Amazing!
Currently up on the day 33.4p at 66p and 102% !

Dividend and Leverage Policy

· The Joint Venture will have a dividend policy the aim of which will be to distribute, annually, at least an amount equal to 90 per cent of the Joint Venture's free cash flow to equity (subject to applicable law and the ability of the directors to adjust dividend payments in the ordinary course).

· In the period to 31 December 2022, up to £20 million of restructuring costs will be excluded from the calculation of free cash flow to equity in order to support the dividend payment to both shareholders.

· CMBC's operational gross debt may not be incurred above 2x EBITDA without Marston's consent, except for in limited circumstances (including to support a dividend to Marston's where there has been expenditure outside the business plan).

And...

Marston's ongoing strategy

Marston's will continue with its stated strategy to reduce its indebtedness, deliver sustainable growth and maximise return on capital for shareholders. The up to £273 million Equalisation Payment will allow Marston's to further deliver on its debt reduction target, materially reducing debt outside the securitisation and providing additional financial flexibility. The Marston's management team remains focused on maintaining a balanced pub portfolio with a well invested estate and on operating its high quality, predominantly freehold, pub and accommodation business offering great places to drink, eat and stay.

What this actually means in terms of a cash dividend in the future, we'll have to wait and see !

Changeable wrote:Dividend and Leverage Policy

· The Joint Venture will have a dividend policy the aim of which will be to distribute, annually, at least an amount equal to 90 per cent of the Joint Venture's free cash flow to equity (subject to applicable law and the ability of the directors to adjust dividend payments in the ordinary course).

· In the period to 31 December 2022, up to £20 million of restructuring costs will be excluded from the calculation of free cash flow to equity in order to support the dividend payment to both shareholders.

· CMBC's operational gross debt may not be incurred above 2x EBITDA without Marston's consent, except for in limited circumstances (including to support a dividend to Marston's where there has been expenditure outside the business plan).

And...

Marston's ongoing strategy

Marston's will continue with its stated strategy to reduce its indebtedness, deliver sustainable growth and maximise return on capital for shareholders. The up to £273 million Equalisation Payment will allow Marston's to further deliver on its debt reduction target, materially reducing debt outside the securitisation and providing additional financial flexibility. The Marston's management team remains focused on maintaining a balanced pub portfolio with a well invested estate and on operating its high quality, predominantly freehold, pub and accommodation business offering great places to drink, eat and stay.

What this actually means in terms of a cash dividend in the future, we'll have to wait and see !

The dividend of the Joint Venture will be paid to its owners, that is Marstons and Carlsberg, It will be up to them if, when, how much they in turn distribute to their owners.

More discussion on the Company Share News Board.

Nice. I’m now only 25% down in capital terms

teecee90 wrote:Nice. I’m now only 25% down in capital terms

Yes, but if you had made a knee jerk reaction and sold after the dividend cut you would be down a lot more. This one at least seems to have been one where not having the broker on speed dial has been the right decision. But surely nobody on here that runs an HYP would have sold...

Wizard wrote:Yes, but if you had made a knee jerk reaction and sold after the dividend cut you would be down a lot more. This one at least seems to have been one where not having the broker on speed dial has been the right decision. But surely nobody on here that runs an HYP would have sold...

You'd be surprised, Wizard.

moorfield wrote:

Wizard wrote:Yes, but if you had made a knee jerk reaction and sold after the dividend cut you would be down a lot more. This one at least seems to have been one where not having the broker on speed dial has been the right decision. But surely nobody on here that runs an HYP would have sold...

You'd be surprised, Wizard.

I'm sorry for your financial loss, but your response did make me chuckle

It reminded me of the time last year when I had no spare cash, TUI had plummeted and I sold an IT to release capital to buy a terrific yield. Never chase yield, too good to be true etc. etc. these are all good lessons and examples that I have stored in a file on my laptop under 'Financial Idiocy'.

Cheers, OLTB.

Annoying, I've just started building my position, have peanuts invested. This is the third time it's happened with my pub/beer investments. I think I'm jinxed.

GS

OLTB wrote:

moorfield wrote:

Wizard wrote:Yes, but if you had made a knee jerk reaction and sold after the dividend cut you would be down a lot more. This one at least seems to have been one where not having the broker on speed dial has been the right decision. But surely nobody on here that runs an HYP would have sold...

You'd be surprised, Wizard.

I'm sorry for your financial loss, but your response did make me chuckle

Actually, I wasn't referring to myself... Cheers

GoSeigen wrote:Annoying, I've just started building my position, have peanuts invested. This is the third time it's happened with my pub/beer investments. I think I'm jinxed.

GS

Same here. My £1K punt at 30p now feels stupidly timid but who could have knows about the JV back in March. Had I it would have been 10 fold. Or more.

Still better that than selling out a large position at 30p to chase an illusory yield elsewhere...

Padders72 wrote:

GoSeigen wrote:Annoying, I've just started building my position, have peanuts invested. This is the third time it's happened with my pub/beer investments. I think I'm jinxed.

GS

Same here. My £1K punt at 30p now feels stupidly timid but who could have knows about the JV back in March. Had I it would have been 10 fold. Or more.

Still better that than selling out a large position at 30p to chase an illusory yield elsewhere...

I don't know where, but recently I read a very true observation that in investing you will always have some sort of regret no matter what happens, so just learn to live with it:
-If you buy and the price rises you regret not buying more.
-If you buy and the price falls you regret buying at all.
-If you buy and the price moves sideways you regret the opportunity cost.
& similarly for selling.

The correct move with MARS may actually be to add to the position on the dips. I'll see if I get the urge.

GS

GoSeigen wrote:The correct move with MARS may actually be to add to the position on the dips. I'll see if I get the urge.

GS

....or even add to the position in small sips.

(I'll get my coat!)

GoSeigen wrote:
The correct move with MARS may actually be to add to the position on the dips. I'll see if I get the urge.

GS

I hold MARS, and have been trying to not stare at the share price gyrations over the last 3 months. Given the massive uncertainty of the future viability/profitability/value of this, I am trying hard to tell myself that the correct move is to do nothing. Anything else seems a bit like playing roulette. I think the business has residual asset value in terms of property, so is unlikely to be a complete washout.

funduffer wrote:

GoSeigen wrote:The correct move with MARS may actually be to add to the position on the dips. I'll see if I get the urge.

GS

....or even add to the position in small sips.

(I'll get my coat!)

I've done my best with the odd cans of Bombardier and Hobgoblin. It's hard to find anything decent among all that foreign muck. I was tempted by some Proper Job. but resisted the temptation in favour of Marstons.

TJH

GoSeigen wrote:

Padders72 wrote:

GoSeigen wrote:Annoying, I've just started building my position, have peanuts invested. This is the third time it's happened with my pub/beer investments. I think I'm jinxed.

GS

Same here. My £1K punt at 30p now feels stupidly timid but who could have knows about the JV back in March. Had I it would have been 10 fold. Or more.

Still better that than selling out a large position at 30p to chase an illusory yield elsewhere...

[...]

The correct move with MARS may actually be to add to the position on the dips. I'll see if I get the urge.

Averaged up on these, doubling my position today. Anyone else buying more?

GS

GoSeigen wrote:Averaged up on these, doubling my position today. Anyone else buying more?

GS

Not me, I am up to my limit for any one share in terms of portfolio cost. I last topped them up in February 2019 at 99p. In any case I would not top up until they resume paying dividends, but at these prices they are a tempting morsel.

TJH

tjh290633 wrote:

GoSeigen wrote:Averaged up on these, doubling my position today. Anyone else buying more?

GS

Not me, I am up to my limit for any one share in terms of portfolio cost. I last topped them up in February 2019 at 99p. In any case I would not top up until they resume paying dividends, but at these prices they are a tempting morsel.

TJH

I have been keeping an eye on the pubs in our village, there are three in dog walking distance. All have now reopened, but based on the times I have been past them none of them seems to be doing a huge amount of business. Our village is not big enough to support three pubs and they have all had a reasonable amount of people who drive to them in the past, mainly as they all serve decent food. I am not sure if it is local trade they are lacking or business from people coming from further afield. The one we have historically used most put an online booking system in place when they reopened two weeks ago, but currently if you walk past there are always tables outside free and they will happily accomodate spur of the moment trade.

Based on this very limited and totally unscientific sample I am not sure the reopening of pubs has been quite what was hoped for, certainly not for the ones near us anyway. I wonder how it is going elsewhere. At this stage I am not convinced I would want to put money in to a hospitality business. In time things will get better and shares will recover and dividends probably start being paid, but I fear some may go under before then.

Wizard wrote:

tjh290633 wrote:

GoSeigen wrote:Averaged up on these, doubling my position today. Anyone else buying more?

GS

Not me, I am up to my limit for any one share in terms of portfolio cost. I last topped them up in February 2019 at 99p. In any case I would not top up until they resume paying dividends, but at these prices they are a tempting morsel.

TJH

I have been keeping an eye on the pubs in our village, there are three in dog walking distance. All have now reopened, but based on the times I have been past them none of them seems to be doing a huge amount of business. Our village is not big enough to support three pubs and they have all had a reasonable amount of people who drive to them in the past, mainly as they all serve decent food. I am not sure if it is local trade they are lacking or business from people coming from further afield. The one we have historically used most put an online booking system in place when they reopened two weeks ago, but currently if you walk past there are always tables outside free and they will happily accomodate spur of the moment trade.

Based on this very limited and totally unscientific sample I am not sure the reopening of pubs has been quite what was hoped for, certainly not for the ones near us anyway. I wonder how it is going elsewhere. At this stage I am not convinced I would want to put money in to a hospitality business. In time things will get better and shares will recover and dividends probably start being paid, but I fear some may go under before then.

We went to a Marston's pub locally in Bristol last night and it appeared to be the usual Friday trade which wasn't bad considering the current social distancing rules. We had a very pleasant meal but the kitchen did close earlier than normal at 8pm. There wasn't the usual selection of real ale (only Bombadier) but that will change going forward. It was very similar with our local Wetherspoon last week.