It will affect pgw. They stated this in their conf call. However, it is a small part of their business that they are gearing up to grow. I guess it just won't grow as much.
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Probably splitting hairs mate but perhaps worth noting that $42.3m represents EPS of 5.6 cps so payout ratio was 98% although they did make the point in the announcement that the final dividend includes a special dividend of 1 cps due to the extremely strong cash flows from operating activities of $54.8m (7.25 cps). (i.e. effectively they paid out 76% of operating cash flows).
I guess i'm just making the point that this sort of dividend is potentially sustainable going forward but perhaps investors would be more prudent to expect about 5 cps next year given 1 cent of the 5.5 cps this year is a special divvy.
Good to see that the pension fund shortfall has fallen $13m. Was a problem a couple of years ago when close to $30m. Wouldn't want to honour that liability in a hurry even though the underfunding is significant relative to the size of the fund.
Suppose all the old timers deserve their pension, after all they made the company.
I've spent a bit of time pondering if the SP is going to settle back a bit.
I was hoping it would and had a buy in the market at 41 but got to thinking.
1. Stock trades cum a great divvy of 3.5 cps and is ex very shortly on 26 August.
2. Based on ex stock price of 39.5 cps, (cum 43), you're paying a multiple of only 7 times last years earnings and the company sounds confident it'll grow current years earnings !!
3. Based on ex divvy price of 39.5 cps and assuming next year's dividend is 5 cps (fully imputed) PGW trades on a 2015 net dividend yield of 12.66%, gross of 18.9% for those on a 33% tax rate.
4. PGW beat the top end of market guidance.
I backed my own thinking by adding more today.
So why would it go back to 40 cps cum dividend....well let me put it this way, I'll be backing up the truck if it does :)
Worth noting, today's volume is more than 10 times daily average for this stock.
Wrong, its heavy buying. Stock up 9% in one day :t_up: