Sunday, 26 June 2016

[Sunday Update] Time to Forget the Noise

The biggest news of the week is, of course, Brexit. This is noise in the long-term. We smile
and carry on doing what we do best; buy and hold great dividend paying companies.

In other news, MTN has a new CEO. See the SENS announcement here. There were also numerous other appointments. Let's hope that MTN starts to get its house order now.

No new dividend announcements were made last week. Please see our updated table below:

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Disclaimer: I have tried my best to ensure that the table above is accurate. It is based on factual data and does not contain any recommendations. Errors and Omissions are Excluded (E&OE).

Saturday, 25 June 2016

Brexit: The Sun Will Rise Tomorrow

What does Brexit mean? Your guess is as good as mine. Until now, I have resisted writing about Brexit. I don't even think the UK government know what Brexit means. I don't think anyone really knows. This creates uncertainty. In the short-term, uncertainty creates market volatility (shallow risk). The media has a field day in times like these. See the following snippet from a popular finance website.



Confusion certainly reigns supreme. It is great that we don't care about the short term.

One thing I am sure about is that companies in the UK (and globally) will continue to supply goods and services to their populations. Until this changes (deep risk), I will continue to accumulate dividend-paying businesses.

If there is ever a time to "Forget the Noise", this is probably it. We will probably see periods of negative returns on our holdings as the markets "digest" each piece of news. We must stand firm and focus on our very long-term goal of creating a retirement income stream.

And a final note, humans adapt. Whatever the new status quo, we will adapt and deal with the issues as they present themselves. The sun will rise tomorrow and we will get on with life.

Sunday, 19 June 2016

[Sunday Update] A Quick Update from the Emerald Isle

Good evening. I am writing to you from a farm in the Irish countryside. It is a typical gloomy, rainy Irish day. Perfect weather for a dividend update.

There was not much action this week. No new company results. Life Healthcare (LHC) and Reunert (RLO) pay dividends tomorrow.

The investment universe historic yield has increased marginally this week. The table below has been updated too.


Disclaimer: I have tried my best to ensure that the table above is accurate. It is based on factual data and does not contain any recommendations. Errors and Omissions are Excluded (E&OE).

Sunday, 12 June 2016

[Sunday Update] Spar. Good for You.

There is not much to report this Sunday night. Tomorrow, Spar (SPP) pays its interim dividend of R2.55 a share. There was no other action such as dividend announcements on the equity front.

I have also added a line the average growth etc where I have removed Nampak as the cutting of its dividend skews the numbers.

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Disclaimer: I have tried my best to ensure that the table above is accurate. It is based on factual data and does not contain any recommendations. Errors and Omissions are Excluded (E&OE).

Thursday, 9 June 2016

[Article] While You Were Worrying… by Ben Carlson

I like to read. I read a lot. Articles, books, blogs... you name it. When I read something that hits home I share it. Today, I read an article by Ben Carlson (his blog here) which sums of my thinking. We spend too much time worrying. Ben puts it best with:
My general feelings about the markets are as follows: 
  • Yes, we will have bear markets and crashes in the future.
  • Yes, we will have periods of low returns in the future.
  • Yes, we will have recessions in the future.
  • Yes, risk management is important, but risk avoidance means return avoidance.
  • No, spending all of your time worrying about these types of events is not a good way to manage your portfolio or live your life.

Bad stuff is going to happen in financial markets. It is impossible to predict when so there is no point in worrying about it. So if bad stuff is going to happen, why invest? If you believe in business, then you have to believe in investing. As long as businesses continue to sell products and services and grow the value they sell on average over the long-term, you should do just fine. Of course, if Karl Marx has his way and a free-market system no longer exists, then you need to consider your options.

Here is a link to Ben's article. Put it on your reading list.

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Sunday, 5 June 2016

[Sunday Update] Nampak gets the chop

Nampak cut its dividend this week. Basically, Nampak is struggling - although you'd think everything is not so bad if you read the CEO's comments. I have a couple of excerpts below:

“Nampak has delivered a strong set of results (note: then, why cut dividend?) ... During the reporting period, markets in which Nampak operates were characterised by subdued growth and volatile currencies due to lower commodity prices, drought and tightening global financial conditions (note: code for out of our control).
Given the challenging macroeconomic conditions in the regions where we operate  (note: more code for out of our control), Nampak has taken proactive and prudent steps (note: patting ourselves on the back because we still believe we did very well, problems were not our fault) to reduce its cost base, improve its operational performance, and strengthen its balance sheet by restructuring debt, conserving cash, not declaring an interim ordinary dividend and monetising non-core property. This will increase Nampak’s resilience in the face of challenging conditions and ensure sustainable profitability going forward.
We continue our focus on operational excellence and improved asset utilisation across all of our operations. Enhancements in procurement, operations and product portfolio optimisation have delivered results to the bottom line."

Of course, he knows his business better than me but I can't believe some of the things CEO's write. I just love the buzz words/phrases: "proactive", "improve operational performance", "monetising non-core property", "sustainable profitability", "operational excellence", "asset utilisation" and my favourite, "product portfolio optimisation".

Mr CEO, you haven't told me anything remotely useful. I would prefer you simply wrote:

"Dear Shareholders,
It was a tough year and the business didn't manage to grow its earnings. We can't afford to pay you a dividend. We expect to start a dividend again in [insert date]
Kind regards
Management"

This is useful. Flowery, buzz-word filled language is not.

Ok, rant over. I don't like it when businesses cut dividends. Moving on...

Here is this week's table. I have removed Bidvest as I need to make some adjustments for the Bid Corp unbundling.

[Note: Google drive is down so table has been uploaded as picture]



Disclaimer: I have tried my best to ensure that the table above is accurate. It is based on factual data and does not contain any recommendations. Errors and Omissions are Excluded (E&OE).