^ That would be at Phil's Kitchen i assume? Can confirm they turn out some epic food
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^ That would be at Phil's Kitchen i assume? Can confirm they turn out some epic food
wow...what a hectic!! I have been very busy the last two days...and read the result.
Overall, this is a keeper. Where u can find $1 stock, with a solid assets and paying a dividend stock??
That is me,,my verdict is a hold.
Cash is trash. Just loaded some orders in for this a bit lower
Would like to make this a hold also like Infratil, but constantly need the income and so capital recycling. Have bought back in on the recent dip, hunting for dividends. Thank you also Beagle for your 50/50 tipping point analysis. Looking forward to the AGM. This is an allround quality company that I keep coming back to.
While I like the dividend from my modest holding of OCA, I really struggle to understand why companies pay unimputed dividends while taking on debt. I have read Beagle's post with the dividend policy a few posts ago, but it makes no economic sense to me.
Much prefer the 8.3% fully imputed SFF announced yesterday and which King1212 obviously hasn't seen according to his most recent post !
I believe RYM pay 50% of underlying profit as an unimputed dividend, SUM are about 30%, again unimputed and both have loaded up with massive debt to expand their development program so OCA's approach is certainly not unusual for this sector.
Debt is cheap now Iceman, circa 3% so its no big deal.
Mate, there is no ambiguity about why they are borrowing. They are borrowing to fund their development program, that's the express and only purpose of borrowing. The purpose for OCA embarking on a business transformation program should be crystal clear to all shareholders. You're drawing a very long bow to argue they're borrowing to pay dividends. I have no concerns whatsoever. Debt is merely a tool to achieve an objective.
OCA stated from the very outset with their IPO what their dividend policy is, to pay out between 50-60% of underlying profit after all costs including the cost of borrowing.
At a theoretical conceptual level I can understand your perspective. It's not tax efficient to force shareholders to incur a tax liability on unimputed dividends while contemporaneously incurring higher level's of debt to fund their development program. The problem is if you get too clever with the Govt and can't point to the sector at least paying some tax either at a company or shareholder level...that might not work out to be in the best interests of shareholders in the long run.
Whenever the thorny issue of tax for this sector has come up before the public eye before, RYM has often taken the sector lead and pointed to the tax paid by shareholders on dividends paid. To date their representations (sort of on behalf of the sector) seem to have kept the tax wolves at arms length.
Who would be silly enough to start poking a pack of sleeping wolves ?