Imperial Brands Share Price (IMB)

I'd expect the SP to rise as we head towards the two bigger dividend payouts & the downside for IMB is that it buys back less shares for the same money. It's a shame they didn't cease the buy backs at 1750p & then use the cash saved to pay down some debt.

Then if the SP drops again next year = buy back more shares at a lower price & repeat the cycle once again.

I dare say you are correct Licancabur. I don't know the maturity dates or coupons on IMB's bonds which would affect the decision. Likewise a comparison of the cost of the debt compared to the "cost" of equity (i.e. dividends). I'd be happy to see both some level of buyback and some debt repayment since both will long-term lead to higher EPS and therefore justify a higher dividend, which is why I am invested.

I've been here for quite a while (2013 I think) and wasn't ever comfortable with Alison Cooper's debt pile of £12.x billion whilst increasing the dividend 10% every year. IMB is on a better path now but I would like to see a continued push towards lower debt because we know that stick volume will fall over time. At the moment they are squeezing as much out of the price of ciggies as possible but there could come a time when they are just so expensive (and heavily taxed) that volumes drop considerably. If that happens you don't want to have much debt on the books as all the company's earnings will be directed that way instead of my way! Control your debts before your debts control you etc.

Guitarsolo I imagine the debt would reduce more quickly if they weren't buying in shares. The board clearly calculate that the value of the buybacks in enhancing eps outweighs the debt burden. Just a thought.

I would add a slight reduction in reported net debt from 8.1bn to 8.0bn (or 8.5bn to 8.4bn adjusted net debt - not sure what the difference is there). Personally, I would like to see debt continue to come down so that eventually more of the retained profit can be paid out as dividends. But overall, a solid set of results.

And yes, the price drops!

Fantastic results. Growth in revenues, significant growth in new products, huge growth in profits. Buybacks and dividend increases.... Happy days. Price will obviously fall...