I have just seen the note on the company's site that the last shares have been purchased under this scheme.
I agree that debt reduction is good, but with companies of this size the debt is not allways a cash capital loan, that is repaid easily. My limited knowledge on debt, leads me to think it will be in the form of bonds and other debt types. So the reduction takes time to reduce, combined with building a war chest of cash to replace future borrowing.
If you want to see a good example of company debt reduction look no further than Booker plc. The company now a target for Tesco, so some debt can help keep the wolves away. However if the cyclical nature of makets is to be believed, we are heading for a downturn, and new brands will be purchasable from companies in distress.
I feel the debt reduction should be done, but it might not be an easy fix if we have to buy more brands to keep growing. Reducing dividends is one fix but an unpopular choice, so all in, why I get excited about watching the company "chess game".
Thats the trouble with short term directors views looking to hit targets for their bonuses etc by buy-backs ...... instead of debt reduction, which in the current climate is much more common sense, ie, as extra interest will be reducing profits and making targets harder to achieve.
......as having been completed. ´Fag packet ´ calculation or is it more appropriate to say these days ´phone calculator ´, I don´t know.....anyway DGE´s site shows as at 16 Feb 51,766,359 shares purchased for cancellation. Use a very low price of £25 and you have £1.294bn spent of the £1.5bn pot. Averages of the prices paid are North of the £25 used above so I'm expecting a note out soon.
Can't say I perceived any worth in the share price, would prefer to see the BS strengthened with debt reduction.
"How 2017's medical breakthroughs change your investment strategyDid you know that in 2017, a new British drug reversed type 2 diabetes in half of instances? Or that American researchers discovered how to detect pancreatic cancer, the third-most ..."
Gave my reaction in my previous post, unimpressed despite Ivan's upbeat text, and the Markets Live quoted broker comments were unusually not very iluminating. Per the HL website three brokers now say hold/neutral, one sell and one buy (but no price target). The PTS were 2550p, 2500p, 2320p and 2100p.
So the insider selling yesterday was right with the shares closing at 2535p. Might continue to drift down, hope so as I would like to buy back at some point.
Just glanced at the interims, Ivan trying to hype up fairly unexciting but OK numbers is my impression. Dividend up 5% and that seems to me about the growth rate in the biz netting out the exceptionals. There is likely to be some analyst coverage reported in Markets Live in the Alphaville section today on the FT website 1100-1200, my guess is those who think DGE overvalued unlikely to change their stance particularly given the stronger £ going forward. What's your take?
Shares came back yesterday then bounced initially 50p this morning but pretty much back now to yesterday's close. I like to be invested in DGE but not rushing to buy back having sold a quid higher.
a beet -- It is to a degree, but I suspect the press euphoria on DGE's expected better performance is doing most of the holding up. DGE's last 5 years performance has been pretty meagre from a business perspective.
DGE, BATS, both got over a 2% drop today.
£ has returned to the pre-Brexit vote level -- so much for the scaremongering.
What is does show is 4 different businesses :-
Spirax Sarco -- the steam machine
Diploma -- Niche engineering
Intercontinental Hotels -- clue in the name
Diageo -- booze
Some comparatives - ROCE is consistently 25-30% for all three companies except Diageo which is around 15% -- it had been declining over the years to 12% and blipped back up to 15% in 2017.
Turnover growth is by far the greatest at Diploma, and it's pretty tepid in all the other three, especially Diageo. EBIT growth has been pretty stagnant at DGE and reasonable at the other three -- yet the growth which is no surprise is the rerating of the share prices and share buybacks, some funded by debt perhaps?
IHG's growth in EBIT has been down to flogging off the hotels I assume.
With the exception of Diploma, I suspect all three of the others could be due a rerating - downwards.
Yes indeedy, a bit of misery helps too:
'This obsession about returning the colour of the British passport to imperial blue undermines the arguments of those who claim that the Brexit vote wasn't driven by an urge to turn back the clock.'
Looks like it's worked, lads. Yes it's the, well, navy blue passport for us, back in time we go to real austerity - ration books, bleached white bread ....yum,yum.
Just realised from all your comments that this wondrous new concoction existed.From my favourite inf source Tesco I gleaned:
' Gordon's Premium Pink Distilled Gin was inspired by Gordon's original 1880 pink gin recipe. Crafted to balance the refreshing taste of Gordon's with the sweetness of raspberries and strawberries with the tang of redcurrant. Made using only the highest quality ingredients and only natural flavourings to provide an authentic real berry flavour.
Gordon's Premium Pink Distilled Gin has been created to offer a sweeter and more accessible way to enjoy a gin and tonic. To set the occasion serve in a large wine glass, filled with ice and garnished with fresh strawberries.
For something a little different, try our Gordon's Pink Spritz - mix 2 parts Gordon's Pink with 2 parts lemonade and 1 part prosecco. Serve in a large wine glass filled with ice, garnish with fresh strawberries and raspberries.'
Yo, sounds a blast - that should spice up a cheap drop of prosecco and lemonade at the ladies lunch no end - and all those natural ingredients too (not so sure about the lemonade).
Great stuff, m8. For the lazybones out there, you don't need to slash each sloe you can just put 'em in the freezer in a bag overnight. That'll break the skin, which is what you need to get the colour and flavour out, no worries.
I have a vague memory of making sloe "gin" with some kinda neat basic ethanol rather than gin tel quel. Make sure not to use methanol which will blind you and ruin the Boxing Day meet.
Damsons are a fine alternative to sloes.
LKH on the flybridge or you could buy Gordon's sloe gin
Pick a pound of so of sloes, round about now, or anyway after the first frost. Slash each sloe with a sharp knife and place in an empty clear bottle. Add a pound of sugar, two cloves and a drop of almond essence, and fill the bottle with gin (any old cheap muck will do, don't waste a good one). Leave undisturbed for a couple of days, and then shake vigoursly. The liquid will turn a glorious rich pink colour. Shake every day for 30 days - the liquid will gradually get darker - and then leave for 30 days. It will be delicious by Christmas and perfect for the hipflask at the Boxing Day meet.
I suppose this is the big company response to the craft gin craze, DGE think they are missing out. Would you believe, there is an ft.com video on craft gin, and the Norfolk Club to which I belong and which is so far behind the curve has decided to hold a gin tasting.
I encountered some proferred raspberry flavoured gin a few weeks ago, disappointing it was, but maybe there is a new audience of millenials, chavs et al who think gin is old hat so haven't tried it and are now discovering gin having being seduced by the craft, artisinal hype.
A really cold G&T is one of the best pre lunch aperitifs IMO, and en passant I tried one the other day with the bog standard Schweppes tonic swiftly followed by another with the much touted Fevertree. I was expecting to prefer the Fevertree but no I thought the maligned Schweppes was better.
Speaking of which, at 6pm GMT its time to smite the prune.
"It is not Pink Gin... but merely a gin that happens to be pink - there is a world of cultural and social history between the two."
Absolutely right, m8! Diageo took a lot of stick a couple of years ago for constantly introducing weird flavoured Smirnoffs but clearly have not learned the lesson. It will serve them right if people say the same thing about this gin innovation horlicks.
At the same time it is sometimes the case that one can innovate successfully with an existing brand. A couple of years ago, at the Treatt AGM, they handed out miniature bottles of honey whiskey liqueur. Clearly they were hoping to sell their honey flavouring to big drinks companies. Anyhoo and whatever, that stuff was absolutely delicious. I still have the empty bottle which has a cute little picture of a bee on it [how sad is that?].
"I concur, almost enough to make me ditch the shares..."
And me too... as a confirmed pedant, it really annoys me. It is not Pink Gin... but merely a gin that happens to be pink - there is a world of cultural and social history between the two.
I suppose we should at least credit the attempt at innovation.. even though this effort belongs in the "must try harder" drawer.
I have no DGE shares to ditch, of course, but I feel compelled to reiterate my prevailing "Strong Sell" view - which, to be fair, has probably more to do with the shares being 20% expensive at the current SP (IMHO, of course, as always...)
I concur, almost enough to make me ditch the shares.
I am reminded of Domecq trying to get trendy and putting some weird juices into an amontillado, it got a big thumbs down at a tasting from the visiting wine group I was with and I think they took notice. DGE needs someone on the board or as a consultant to give such ideas and their M&A a reality check, LKH would be the person.
I am not being flippant, note to Ivan, please make him an offer he can't refuse.
Hmmm. I see that Diageo is launching what it calls Gordon's pink gin.
At first I thought:
"Excellent. No need to go to all that tiring business of getting out the Angostura Bitters bottle and shaking it into two stiff fingers of Gordon's; Ivan is doing the heavy lifting for me by combining the ingredients in a single bottle".
However it transpires that he's not using Angosturas (or some commoditised equivalent thereof) ... the feller is using a flavouring of raspberries, strawberries and redcurrants in order to give the stuff a light pink 'blush'. Dear God, is nothing sacred?
Diageo risks making Gordon's a laughing stock with this girlyboy launch. It'll become the Blossom Hill of gin if he's not careful.
"while he's at it get something in place for online shopping like the rest of the grown up world."
Diageo used to have a site called Alexander & James on which they sold various reserve brands at eye-watering prices to people with more money than sense, but they shut it down at the end of January this year.
I wish they had an online scheme whereby one could buy crates of their standard hooch at a sensible discount to the supermarket price. There would be the risk that they'd upset the supermarkets but, hey, that's a risk I can live with.
Likewise Unilever should do the same thing. I'm up for buying deodorant, shampoo, Flora, and mayonnaise by the crate if the price is right, even if, initially, the scheme is only a perk for shareholders.
nimbo - I'll take a good look at Bongo and see how it reads m8.
One other trick up PayPal's sleeve is Venmo -- all the millenials (strange label I know) are using it and it's transaction values jumped from $6.5BN to 8.5BN in a year.
As a peer to peer money transfer with social media facilities it's been a real winner for PayPal and it was cheap as chips when they bought it - relatively speaking I mean.
Ivan could do with it to pay his web administrator as he can transfer the incentive money straight into the web guys account and send him a message to get rid of all the old products off his dire web site. And while he's at it get something in place for online shopping like the rest of the grown up world.
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