The Lemon Fool

Here; viewtopic.php?p=323980#p323980

idpickering wrote:Here; viewtopic.php?p=323980#p323980

Today's RNS announcement (posted in that thread) has some news of particular interest to HYPers:

"In March 2020, given the uncertainties caused by the impact of COVID-19, the Board cancelled the interim dividend of 9.8 pence per share, equating to c. £100.0m4, which was due to be paid on 11 May 2020. The Board has decided that, given the unprecedented impact of COVID-19, it will not propose to shareholders at the AGM in October 2020 an ordinary dividend in respect of FY20 or the previously announced special dividend of £175m in respect of FY20. However, the Board continues to recognise the importance of dividends as a part of overall shareholder returns and will give further consideration to future dividend policy."

As that says, the cancellation of the interim dividend is old news, having appeared in an RNS last March, which said:

"Given the uncertainties caused by the impact of COVID-19, the Board believes it is appropriate to cancel the interim dividend of 9.8 pence per share (c.£100m), which was due to be paid on 11 May 2020. The Board recognises the importance of dividends as a part of overall shareholder returns and will consider dividends at the time of announcing the full year results in September taking into account the position on COVID-19."

So the cancellation of the final dividend and the special dividend are new, and indeed have been considered and decided upon earlier than previously announced.

The following bit from today's RNS may also be of interest:

"Through the temporary closure of the business, where around 85% of our employees were placed on furlough, we used the Government's Coronavirus Job Retention Scheme. All of our employees, other than those shielding, have now returned from furlough. We are grateful for the support that the Government has provided to UK businesses through the Coronavirus Job Retention Scheme, which allowed us to safeguard the jobs of our c. 6,700 employees during the height of the pandemic. However, our financial position has remained resilient; therefore, we will now repay all furlough funds received."

I had my say on the very similar decision by Taylor Wimpey in mid-May and feel similarly about this decision, so am unlikely to comment further. But this alternative use to which the company puts cash that could be used to pay dividends does seem to be of interest to people here and so worth drawing to this board's attention.

Gengulphus

I commented on the matter of the dividend cancellation on the Company news Board. I still find the double posting of these announcements very confusing.

Dod

Another disappointment but one that I expect to be repeated with other companies. Let's hope that there is not another wave of Covid-19 and a second shutdown of the economy.

Dod101 wrote:I commented on the matter of the dividend cancellation on the Company news Board. I still find the double posting of these announcements very confusing.

Dod

I do get what you're saying regarding my double postings. The reason I bring these items to the attention of HYPers, is so that they can chat about that item, on HYP Practical, from a HYPers perspective. Some holders might not be HYPers at all, hence the posting on the Company News Board, for all other holders notice, and to comment should they like to do so. Mods are aware of my tactics re doubling up, and my reasoning to do so. Should I be directed to stop doing so, I will abide by that instruction.

Ian.

idpickering wrote:

Dod101 wrote:I commented on the matter of the dividend cancellation on the Company news Board. I still find the double posting of these announcements very confusing.

Dod

I do get what you're saying regarding my double postings. The reason I bring these items to the attention of HYPers, is so that they can chat about that item, on HYP Practical, from a HYPers perspective. Some holders might not be HYPers at all, hence the posting on the Company News Board, for all other holders notice, and to comment should they like to do so. Mods are aware of my tactics re doubling up, and my reasoning to do so. Should I be directed to stop doing so, I will abide by that instruction.

Ian.

I am not being critical of you Ian, in fact not being critical at all; I just find it confusing that's all.

Dod

Dod101 wrote:

I am not being critical of you Ian, in fact not being critical at all; I just find it confusing that's all.

Dod

Thanks for that Dod. I wasn't implying you were, rest assured of that. I do get where you're coming from though. It baffles me too.

Ian.

Gengulphus wrote:The following bit from today's RNS may also be of interest:

"Through the temporary closure of the business, where around 85% of our employees were placed on furlough, we used the Government's Coronavirus Job Retention Scheme. All of our employees, other than those shielding, have now returned from furlough. We are grateful for the support that the Government has provided to UK businesses through the Coronavirus Job Retention Scheme, which allowed us to safeguard the jobs of our c. 6,700 employees during the height of the pandemic. However, our financial position has remained resilient; therefore, we will now repay all furlough funds received."

My take on their decision to repay furlough funding is that to not do so would make future dividends and specials very difficult, politically speaking. If they continue to throw off cash at the same rate that they were doing before this pandemic, then they would be an easy target indeed for a windfall tax or other punitive action, whereas this repayment, whilst painful to shareholders short term, may well position the company onto moral high ground from which it would be much harder to attack them or their shareholders.

It also takes the heat off of the executive pay packages...

VRD