Member Info for fleccy

"I hold shares at an average cost to me at 21.24p per share."

LTI, when did you purchase your shares to average 21.24p per share?

"Inflated nasdaq about 6^ off of high"

The Nasdaq is nudging 10% down on the November high.

"US is back in a bear market. Nasdaq tanking. Bad earnings, soaring inflation, rocketing interest rates and high bond yields."

Makes me laugh, that the NASDAQ is described as tanking when it's up 163% over the last 5 years, with the FTSE100 up just over 5%.

https://www.google.com/finance/quote/.IXIC:INDEXNASDAQ?comparison=INDEXFTSE%3AUKX&window=5Y

"Any shareholder can if they wish sell a shareholding at any time based on forecasts or not"

Well I was up over £14000, this morning, on my Lloyds shareholding, currently up £13,047 as I type this, so it isn't like I'd lose if I did decide to sell out and look elsewhere in the near future.

"I have already said, that barring unforeseen circumstances Lloyds can afford a 3p + normal dividend AND share buybacks"

Well that'll ne a good few years, going off the analyst forecast.

"Analysts are forecasting a dividend of 1.99p per Lloyds share, totalling £1.41bn, for 2021, rising to £1.59bn for 2022 and £1.79bn for 2023. "

So FY2022 is forecast to be 2.24p, and FY2023 is forecast to be 2.5p, so not good if the analyst's have been given a heads up, and are correct.

"You could have fooled me, with a number of posts referencing them."

Not really, the point was that the share buybacks aren't helping the long term investors, who may see a significant cut in their income. The benefits seem to have continued while shareholders suffer.
The Employees earn a wage for doing a job, some of the older investors may be dependant on their dividend income from their Lloyds shareholding, why should Granny and Grandad suffer, while the directors continue to reward themselves. If the Dividend is cut, or reduced, then Employee benefits should be similarly impacted.

"If an investor wants to invest in such a company and are not stupid enough not to know about staff benefits , then that have ZERO rights to complain about them.
If they do complain about staff benefits then that must put them into the STUPID category."

If you read all my posts, on this subject LTI, I don't care about the share buybacks/Employee benefits. I do have a problem with the forecast FY21 Dividend of 2p, which is 35.5% lower than the FY2018 Dividend of 3,21p, especially when FY2019 was on target for 3.6p. Lloyds can reward their employees, and I don't have a problem with that, except for when it appears shareholders are expected to see a drop in income for no apparent reason. Touting the share buybacks as some sort of compensation for reduced dividends is clearly false, since the buybacks really only avoid dilution due to Block listings for said employee benefits, that's why I have a problem.

"Fleccy, Lti would argue black was white, but he has always been a staunch supporter of buy backs and continually argues in support of them. Personally, I agree with you, buy backs are futile in Lloys case and a source of irritation for a lot of shareholders."

I'm not against the share buybacks, as they prevent dilution; What I don't agree with, is the pantomine of dressing the buybacks up as enhancing shareholder value, while cutting dividends. It's a case of issue new shares to give yourself a bonus, then enhance your bonus by increasing the share price with buybacks.
As I said, I wouldn't be bothered if the Dividend isn't facing a cut from 2018 levels, which is what forecasts are suggesting. Describing the restarting of dividends as progressive, is doubly insulting if it's restarted 37.5% lower than the 2018 dividend, and looking at being lower for years to come.

"LBG obviously see some PR benefit in this as they dress it up as 'returning cash to investors' (a philosophical point) but as any reader of this BB can see, many investors don't feel they enjoy any benefit whatsoever."

I wouldn't be bothered, if I wasn't facing a dividend cut on the back of Covid. I can understand why they suspended the dividend during the pandemic, but what grates with me is the forecast dividend cut fro the 2018 3.21p to around 2p; and what grates even more is that the 2019 dividend was heading for 3.6p. If Covid hasn't affected Lloyds financially, why are they punishing long term holders? Lloyds also increased the number of shares in issue by more than 800 million shares during the pandemic, for sharesave schemes and bonus plans.

"Or to put it another way, the share buyback is paying for the staff incentive share schemes........ not going to investors.
The number of shares does not go down and drive up the share price which is the perceived aim of buybacks in returning money to shareholders (Aviva being a good example at the moment).
Of course the number of shares would be higher without it, but the reality is that it is paying staff incentives."

Exactly my point, for some reason LTI argued against it.

"fleccy
the number of shares increases because of staff rewards etc
the number of shares decreases when buybacks occur
where am I going wrong?"

You're correct, the buybacks are avoiding dilution due to the issuance of shares for discounted share schemes. LTI is correct in what he says, but his answers miss the point that share buybacks are normally aimed at reducing shares in a company, whereas in Lloyds case the share buybacks are like refilling a bucket with a small hole in the bottom.

You can't force someone to see the truth, just like you can't force a blind man to see.

I'll put it another way.

You have two companies:

Company A buys shares on the market, with a share price of £1, for share schemes and bonus plans. They then anounce a Share Buyback of £1 Billion, and reduce their shares in issue by 1 Billion shares. If they previouls had 10 Billion shares in issue, this is now reduced to 9 Billion shares in issue.

Company L, instead of buying shares and placing them in treasury, for sharesave schemes, bonus plans, etc, issues new stock to satisfy their discounted schemes.
Company L increase their shares in issue by 900 million, lets say. To keep the figures simple, lets say company L's shares are also £1 and they originally had 10 billion shares in issue, increasing to 10.9 Billion after dilution due to share issuance. They then anounce a buyback for £1 Billion, and reduce their shares in issue to 9.9 Billion, and therefore have 0.9 Billion more shares in issue than Company A.

My point is Company A might have spent twice as much money on shares, than company L, but their share buyback is considerably more significant and meaningful than Company L's, who have only more or less stayed static.
Company A has therefore reduced it shares in issue, which means the shares will acrue in value relatively, unlike company L who hasn't really reduced the shares in issue.

"In total 3.465 Billion less shares are on the register than if the buybacks hadn't taken place."

And 2.5 Billion more shares as if the buybacks hadn't taken place.

"So just 969,447,920 shares less than in April 2018, where did the other 2.5 Billion shares go?"

Basically it's a zero sum game, with the shares in issue remaining around 70 Billion, irrespective of share buybacks.

"The 2018 buyback means that there are 1.578 Billions shares less shares on the register than there would be now.
The 2019 buyback means that there are 1.887 Billions shares less shares on the register than there would be now.

So in total 3.465 Billion less shares than there would otherwise be now."

And yet the nuber of shares in issue April 2018 was:

"
As at 30 April 2018, the total number of shares issued by Lloyds Banking Group plc with rights to vote which are exercisable in all circumstances at general meetings is 71,992,041,055 ordinary shares of 10p each, which includes shares represented by American Depositary Receipts. No shares are held in treasury.."

https://www.lse.co.uk/rns/LLOY/total-voting-rights-k93oa24qchna7nz.html

And currently:

"As at 31 December 2021, the total number of shares issued by Lloyds Banking Group plc with rights to vote which are exercisable in all circumstances at general meetings is 71,022,593,135 ordinary shares of 10p each, which includes shares represented by American Depositary Receipts. No shares are held in treasury."

https://www.lse.co.uk/rns/LLOY/total-voting-rights-r0w2wv6nwdd17uu.html

So just 969,447,920 shares less than in April 2018, where did the other 2.5 Billion shares go?

"Trying to work out the number of issued share reductions by a given sum is impossible not only by the SP variation over time spent but also, last time Lloyds refused to discuss and more importantly refused to disclose the charges incurred for conducting the buyback."

I was about to log out, but then i thought. why were Lloyds issuing shares for sharesave's and Bonus plans anyway, when shareholders were being denied a dividend. You'd think that any such schemes would be suspended too, sharing the pain and all that.

"A £1.2 Billion buyback conducted at an average 60p including costs will reduce the share count by 2 Billion shares .
Simple"

LTI, are you seriously saying that Block share issuance has no effect on the number of shares in issue? And that by issuing shares, before the buyback, it doesn't effectively neutralise a significant amount of said buyback?
You likely know what I mean, I wont spend any more time explaining it. Goodnight.

"I am afraid you are following on from a couple of dozen people before you trying to make 'the point'.
The fact is a share buyback programme has NOTHING to do with share schemes.
A buyback will reduce the share count by how ever many can be purchased with the money available."

It's pointless discussing it with you LTI. What you say is true in fact, but the buyback is meaningless overall if it only replaces shares issued for Employee schemes.

"IF doesn't come into it. Most large financial institutions or indeed most large quoted corporations would have share based schemes as part of the overall remuneration to attract the calibre of staff required.
They have NOTHING to do with the reduction in share count as a result of a buyback programme."

Most large corporations purchase the shares into Treasury, for sharesave's and Bonus plans, not issue new shares and therefore diluting the shares in issue.