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| What Did Umberto Say About the Ignorant? |
GFH
has announced
its FY2019 AGM date and agenda on the BSE.
The
meeting will be held 23 March.
If
there isn’t a quorum, the second meeting will be on 30 March and,
if necessary, a third on 6 April.
Shareholders will certainly benefit from a close reading and re-reading of my previous posts on GFH’s
FY 2019 performance and as well my analysis of what is behind
GFH’s
rather expensive foray into Treasury Shares as
preparation for the upcoming AGM.
Of
note from the agenda is GFH’s recommendation that shareholders
approve a 5.57% cash dividend (approximately US 50 million).
That
represents some 63 % of GFH’s FY 2019 income attributable to GFH
shareholders.
In
that context, I’d remind shareholders and readers that in February
GFH “successfully priced” a USD 300 million sukuk at 7.5% fixed
per annum. Quel succes.
In
my post I noted that during FY 2019 GFH engaged in purely
discretionary uses of cash of some USD 140 million.
If
it had forgone these, it could have raised USD 140 million less
saving USD 52.5
million in interest over the life of the Sukuk.
Adding in the USD 50
million in dividends, adds another USD 18.75 million to interest,
bringing the total to USD 71.25 million.
AA is frankly stumped to
come up with a sound business rationale for such an action.
It
would, however, neatly fit with the theory that GFH’s Treasury
Share and Dividends are designed to prop up its share price rather
than build new value for GFH’s shareholders.
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