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Merchants (MRCH) Divi announcement

Closed-end funds and OEICs
monabri
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Merchants (MRCH) Divi announcement

#381082

Postby monabri » January 27th, 2021, 12:53 am

https://www.investegate.co.uk/merchants ... 43469679M/

"The board has declared a third quarterly dividend of 6.8p per Ordinary Share, payable on 16 March 2021 to holders on the register at the close of business on 5 February 2021."

"A key objective of the company is to pay an increasing dividend each year. There have been a large number of dividend cuts in the stock market, including within the investment portfolio, due to the coronavirus pandemic. Taking these into account, the income received by the company will be significantly lower both this year and probably next year compared to the last financial year."


"The company had more than one year's total dividend payment in revenue reserves at the last year end, which the board is prepared to use to cover any shortfalls."

88V8
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Re: Merchants (MRCH) Divi announcement

#381394

Postby 88V8 » January 27th, 2021, 11:14 pm

monabri wrote:"The company had more than one year's total dividend payment in revenue reserves at the last year end, which the board is prepared to use to cover any shortfalls."

And quite right too. It would seem bizarre not to do so, but nice to see it in black n white.

This smoothing capacity is why I am leaning more towards income ITs.

V8 (I hold)

monabri
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Merchants (MRCH) Divi announcement

#404107

Postby monabri » April 14th, 2021, 9:45 am

https://www.investegate.co.uk/merchants ... 00093705V/

XD 22 April 2021
Pay 18 May 2021
Divi = 6.8p



"As noted, the year saw a large number of dividend cuts in the market and this has inevitably impacted earnings per share which are down more than a third to 18.5p. The board recognises the importance of a growing dividend to shareholders. We can see a path to a covered dividend in the medium term. Absent any significant further deterioration in the outlook for income, the board plans to continue with its progressive dividend policy, and is willing to consider utilising reserves, built up over many years, to cover any shortfall from earnings. We propose a final quarterly dividend for shareholder approval of 6.8p which means for 2020 an increased full-year dividend of 27.2p. This includes a contribution from reserves of 9.9p, leaving 18.3p in reserves at the year end. Whilst this dividend represents a nominal increase of 0.4% over the 2019 dividend of 27.1p, close to but not in excess of the 2020 rate of inflation, we have now grown the dividend for 39 consecutive years at an annualised growth rate of just under 7%, well above the rate of inflation over that period which stands at 3.4% annually as measured by the Consumer Prices Index (CPI)."

Spet0789
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Re: Merchants (MRCH) Divi announcement

#404139

Postby Spet0789 » April 14th, 2021, 11:43 am

monabri wrote:https://www.investegate.co.uk/merchants-trust.--mrch-/rns/final-results/202104140700093705V/

XD 22 April 2021
Pay 18 May 2021
Divi = 6.8p



"As noted, the year saw a large number of dividend cuts in the market and this has inevitably impacted earnings per share which are down more than a third to 18.5p. The board recognises the importance of a growing dividend to shareholders. We can see a path to a covered dividend in the medium term. Absent any significant further deterioration in the outlook for income, the board plans to continue with its progressive dividend policy, and is willing to consider utilising reserves, built up over many years, to cover any shortfall from earnings. We propose a final quarterly dividend for shareholder approval of 6.8p which means for 2020 an increased full-year dividend of 27.2p. This includes a contribution from reserves of 9.9p, leaving 18.3p in reserves at the year end. Whilst this dividend represents a nominal increase of 0.4% over the 2019 dividend of 27.1p, close to but not in excess of the 2020 rate of inflation, we have now grown the dividend for 39 consecutive years at an annualised growth rate of just under 7%, well above the rate of inflation over that period which stands at 3.4% annually as measured by the Consumer Prices Index (CPI)."


My wife holds MRCH. As a TR investment, you'd obviously be better holding SMT or VWRL but that's irrelevant in my view. MRCH does deliver precisely what it says on the tin - an above average income rising higher than inflation. Well done to the management team and board. No question in my mind that this is one of the best one-stop income investments / annuity replacements. Far better (the heresy!) for 99.9% of investors than building a HYP in my view.

monabri
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Re: Merchants (MRCH) Divi announcement

#404142

Postby monabri » April 14th, 2021, 11:49 am

Spet0789 wrote:Far better (the heresy!) for 99.9% of investors than building a HYP in my view.


I'm one of the 99.9% and I would agree with you based on my HYP v IT performance.

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Re: Merchants (MRCH) Divi announcement

#404146

Postby Dod101 » April 14th, 2021, 11:59 am

Spet0789 wrote: No question in my mind that this is one of the best one-stop income investments / annuity replacements. Far better (the heresy!) for 99.9% of investors than building a HYP in my view.


That is a very bold claim. Firstly you have to exclude the amount of the dividend coming from Merchant's reserves for the purposes of comparing the income with a HYP. Capitalwise? I do not know and am not knocking Merchants jsut that there are other ITs and if you use capital as income for one then you need to do it for the other.

Dod

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Re: Merchants (MRCH) Divi announcement

#404153

Postby Spet0789 » April 14th, 2021, 12:17 pm

Dod101 wrote:
Spet0789 wrote: No question in my mind that this is one of the best one-stop income investments / annuity replacements. Far better (the heresy!) for 99.9% of investors than building a HYP in my view.


That is a very bold claim. Firstly you have to exclude the amount of the dividend coming from Merchant's reserves for the purposes of comparing the income with a HYP. Capitalwise? I do not know and am not knocking Merchants jsut that there are other ITs and if you use capital as income for one then you need to do it for the other.

Dod


Not sure it's that bold! The ability of an IT to smooth income is one of the advantages for investors in my view. Of course you can do it yourself with your HYP, but why bother when it can be done for you?

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Re: Merchants (MRCH) Divi announcement

#404264

Postby OLTB » April 14th, 2021, 5:44 pm

When both Sky and Greene King were ‘market traded’ away from my HYP, I chose to reinvest the proceeds in MRCH. The capital value is now higher than the initial investment sum and income has been constant throughout the last year. No complaints from me!

Cheers, OLTB.

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Re: Merchants (MRCH) Divi announcement

#404284

Postby 88V8 » April 14th, 2021, 6:48 pm

As I mentioned elsewhere, for an income investor I am coming to view ITs as an investment, and HYP as a hobby.

I hold MRCH as part of an income IT portfolio.

V8

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Re: Merchants (MRCH) Divi announcement

#404306

Postby forrado » April 14th, 2021, 8:20 pm

Spet0789 wrote:My wife holds MRCH. As a TR investment, you'd obviously be better holding SMT or VWRL but that's irrelevant in my view. MRCH does deliver precisely what it says on the tin - an above average income rising higher than inflation. Well done to the management team and board. No question in my mind that this is one of the best one-stop income investments / annuity replacements. Far better (the heresy!) for 99.9% of investors than building a HYP in my view.

I’d challenge the statement that Merchants provides “an above average income rising higher than inflation”. While there is no denying that MRCH has been successful at delivering “precisely what it says on the tin”, there have been periods when payouts have not kept pace with inflation.

The AIC stats for the trust state that 2.6% has been the annual dividend growth over the most recent 5-year period. While the ONS calculates the rate of inflation over the same 5-year period, as measured by the RPI, also to be an annual 2.6%.

Rollback a further 5-year period (covering 2011 to 2015) and, again using AIC stats, Merchant’s yearly payouts grew from a 2011 per share amount of 22.8p to 24p by the end of 2015 – an increase 5.3% - compared to a 14.8% rise is RPI.

Now, with the help of a spreadsheet, ONS inflation and MRCH dividend payout data going back to 1973 on the AIC site, one can rollback a number of 5-year periods if one is so included rather than just the last two 5-year periods I’ve done above. Though, I think one should get the idea as to what I’m attempting to illustrate.

Of course, Merchants could well be entering a ‘golden’ period when payout rises are above that of inflation. One could make the case that conditions for the trust are now more friendly in terms of lower serviceable debenture borrowings and a value focused fund manager style that appears to be making a comeback. I also believe the Board are all too acutely aware as to the profile of their shareholders, who they will not want to disappoint.

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Re: Merchants (MRCH) Divi announcement

#404308

Postby Spet0789 » April 14th, 2021, 8:27 pm

forrado wrote:
Spet0789 wrote:My wife holds MRCH. As a TR investment, you'd obviously be better holding SMT or VWRL but that's irrelevant in my view. MRCH does deliver precisely what it says on the tin - an above average income rising higher than inflation. Well done to the management team and board. No question in my mind that this is one of the best one-stop income investments / annuity replacements. Far better (the heresy!) for 99.9% of investors than building a HYP in my view.

I’d challenge the statement that Merchants provides “an above average income rising higher than inflation”. While there is no denying that MRCH has been successful at delivering “precisely what it says on the tin”, there have been periods when payouts have not kept pace with inflation.

The AIC stats for the trust state that 2.6% has been the annual dividend growth over the most recent 5-year period. While the ONS calculates the rate of inflation over the same 5-year period, as measured by the RPI, also to be an annual 2.6%.

Rollback a further 5-year period (covering 2011 to 2015) and, again using AIC stats, Merchant’s yearly payouts grew from a 2011 per share amount of 22.8p to 24p by the end of 2015 – an increase 5.3% - compared to a 14.8% rise is RPI.

Now, with the help of a spreadsheet, ONS inflation and MRCH dividend payout data going back to 1973 on the AIC site, one can rollback a number of 5-year periods if one is so included rather than just the last two 5-year periods I’ve done above. Though, I think one should get the idea as to what I’m attempting to illustrate.

Of course, Merchants could well be entering a ‘golden’ period when payout rises are above that of inflation. One could make the case that conditions for the trust are now more friendly in terms of lower serviceable debenture borrowings and a value focused fund manager style that appears to be making a comeback. I also believe the Board are all too acutely aware as to the profile of their shareholders, who they will not want to disappoint.


There are certainly periods in which the dividend growth has lagged inflation, but over the long run (the last 20 years) the dividend has grown in line with or higher than inflation.

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Re: Merchants (MRCH) Divi announcement

#424079

Postby JuanDB » July 1st, 2021, 8:45 pm

https://www.investegate.co.uk/merchants-trust.--mrch-/rns/dividend-declaration/202107011740349299D/

The board has declared a first interim dividend of 6.8p per share, payable on 20 August 2021 to holders on the register at the close of business on 16 July 2021. This dividend is in line with the final dividend paid last year.

Sixth consecutive quartet at the same payout level.

monabri
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Re: Merchants (MRCH) Divi announcement

#424084

Postby monabri » July 1st, 2021, 10:19 pm

JuanDB wrote:https://www.investegate.co.uk/merchants-trust.--mrch-/rns/dividend-declaration/202107011740349299D/

The board has declared a first interim dividend of 6.8p per share, payable on 20 August 2021 to holders on the register at the close of business on 16 July 2021. This dividend is in line with the final dividend paid last year.

Sixth consecutive quartet at the same payout level.


That was declared late today eh?

Q1 to Q4 dividends last year were all 6.8p. As this is the Q1 dividend there is hopef5 scope to tweak future dividend(s) to maintain AIC dividend "Hero" status ( but it will no doubt be a small tweak).

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Re: Merchants (MRCH) Divi announcement

#424122

Postby Spet0789 » July 2nd, 2021, 8:13 am

Agreed. MRCH will hike by a small amount soon to maintain their record for rising dividends.

I think this IT has had a decent COVID crisis. Holding income flat is an achievement in the circumstances.

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Re: Merchants (MRCH) Divi announcement

#447530

Postby monabri » October 3rd, 2021, 5:12 pm

https://www.investegate.co.uk/merchants ... 00079740M/

"The board has declared a second quarterly dividend of 6.8p per ordinary share, payable on 11 November 2021 to shareholders on the register at close of business on 8 October 2021. A Dividend Reinvestment Plan ('DRIP') is available for this dividend for which the relevant Election Date is 21 October 2021 and the ex-dividend date is 7 October 2021.

For the first half of this financial year the dividend has been maintained at a consistent level with 2020, with a total distribution declared of 13.6p. As noted in the latest annual report, the board remains committed to the payment of a progressive dividend to shareholders, having now raised the dividend for 39 consecutive years and being one of the AIC's 'Dividend Heroes', an elite group of investment trust companies that have increased their dividends each year for 20 years or more."

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Re: Merchants (MRCH) Divi announcement

#474884

Postby monabri » January 20th, 2022, 10:02 pm

https://www.investegate.co.uk/merchants ... 13091577Z/


"The board has declared a third interim dividend of 6.85p per Ordinary Share (compared with 6.80p for the third interim in the year ended 31 January 2021), payable on 15 March 2022 to holders on the register at the close of business on 4 February 2022. A Dividend Reinvestment Plan (DRIP) is available for this dividend and the relevant Election Date is 18 February 2022."

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Re: Merchants (MRCH) Divi announcement

#474899

Postby monabri » January 20th, 2022, 11:32 pm

XD 3rd February

Pay 15th March

monabri
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Re: Merchants (MRCH) Divi announcement

#489090

Postby monabri » March 25th, 2022, 10:33 am

viewtopic.php?p=489049#p489049

A link to a review by Edison on MRCH.

( it was originally a stand alone post)


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