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When was this Hamm ... I can only see the ones by Rupert as exiting CEO sold in November, which were not a surprise.
Pretty sure the incoming CEO will now purchase over time in line with minimum holding requirements, if not already met in previous roles in Serco.
I think of it as professional scepticism ... if it's not clear then either people won't understand it and be naturally pessimistic, of they'll be suspicious that issues are trying to be hidden in the complexity ... none bode well for a positive sentiment for valuation. As for share buybacks, I think this will be the last thing on their mind, as this would start to impact gearing and could impact any bank covenants. I think dividends will be a priority as soon as sustainable free cash flows are being generated - and personally I'd rather they eradicate the complexity before they move onto them. Fix what needs fixing and ensure it stays fixed.
Did anybody see the webinar with Stuart Morgan earlier today ? ... Overall I thought it was quite poor, with a lot of the year end presentation simply regurgitated ... I thought it was interesting however that Stuart Morgan indicated that if the sale of the Portfolio Division goes to plan then Capita, if they so wished, could be a "debt-free" business by HY 2023. Obviously this would be on a pre-IFRS 16 basis and I think a certain level of debt is healthy but interesting that he could see that as a confident scenario. Also talked about potential dividend resumption, but conservatively this would be at the earliest a discussion in 2023 for effect in 2024. Anybody else have any thoughts from the webinar ?
In most cases the sale is not optional, especially if the shares are part of a scheme that has vested and options are being exercised. A number of shares are granted, then on exercise a tranche are sold to cover associated tax and NI with the balance retained. If these are performance related shares then highly unlikely they have been sold at a loss, or maybe just strategically advantageous from an overall tax position given the potential growth and associated dividends on the shares retained.
Perfectly normal treatment and certainly not anything untoward. A balance sheet is what a company owns and what it owes. So when assets are sold / disposed or impaired they come off there is a reduction in assets, similarly the proceeds are in increase in assets - very rarely do the 2 figures agree. What you are seeing in the income statement is not the proceeds, but the differential as either a gain or loss on disposal subject to the maths. What you need to focus on is not trading per se but underlying trading profit i.e. that attached to the ongoing business.
Takeover "rumours" apparently ... https://www.thisismoney.co.uk/money/markets/article-9913159/MARKET-REPORT-Takeover-chatter-bolsters-Bab****-International.html
The dividend was less about value and more about a token ... don't forget its the first dividend in 7 years so this is a major milestone, I would imagine they have been cautious with this one. Whilst I have some reservations about whether the buyback programme was the best use of cash it will increase the share price as they are planning to cancel c.50% of the shares bought once the programme finishes later this year. Either way I'm disappointed with share performance, the share is now now than it was before guidance was upgraded earlier in the week.
You could be onto something there Jinny ... Serco announced in September they were on the hunt for acquisitions and at that debt level and performance they are well placed. It was only 18 months ago they made a hostile bid for Bab****. Interesting time for the sector in terms of volatility and consolidation.
Serco were (and still are) due a scheduled trading update as part of pre-close in December (17th) .... the Feb 2021 reference is full year results. Announcement was probably to bring some stability to the slipping SP. December announcement will also give consideration to dividend reinstatement which hopefully now is more probable given cover and reducing debt.
Understand the point D0berman, sorry didn’t mean for it to sound like I was having a go. Personally I don’t think that’s it ... I think not reinstating the dividend hasn’t helped, guidance for the full year is still on a wider range than normal and there has been no guidance at all for 2021 which is probably causing nervousness. Dividend reinstatement is not being considered again until Q4. On that basis there is probably better investments around in the short term. I still think the drop is rather harsh however considering such strong performance in the current climate.