Boot (henry) Share Discussion Threads

[bodyboarder_bill] 10/2/2006 11:09

Enami - I stuck a limit order in at 690 earlier this week which was triggered this morning, so I guess I'll now wait and see what price the consolidated share appears at next week before deciding whether to re-invest or put the money elsewhere. Thanks for your clarification of the arithmetic of this strange situation!

[ben nevis] 10/2/2006 10:58

Anybody understand this ?

At 10.05 am, Masses of sales announced and the price shoots up ?

( the sales were on 8th Feb but announced today)

[enami] 10/2/2006 10:52

I forgot the normal dividend in my calculations – assuming for simplicity 580 shares bought at 602

590 @ 602 = 3551 capital outlay

380 @ 692 = 2629 + 1180 (590x2 special div) – 295 (TAX) = 3514
add normal div 54 = 3568 capital after consolidation

If sell 590 at 692 = 4082 = 531 gain + 54 normal div.
Could buy back 590 next week at lower price maybe – who knows?

So todays high is right on that mark. I sold on Tuesday at 680.5 and happy with cap gain rather than pay tax as I am still under CGT limit.

[bodyboarder_bill] 10/2/2006 09:15

Enami - Thanks.

Ben Nevis - I am sure that in normal circumstances the price must fall once the 200p qualification lapses, but in this instance the consolidation should in theory bring the price of the consolidated share back to roughly where the unconsolidated share was prior to going ex-div. How on earth this would work with any open spreadbets (long or short) I just do not know...

Good luck! (But I'd be inclined to stay clear of any derivative exposure unless you are sure you know what you are doing.)

[ben nevis] 10/2/2006 09:06

I was short using rolling daily, but have closed, since shorters usually suffer when there is a dividend (dont think we'd lose 200 p but there coulcd be a nasty effect ?)

So now I am short using MAR which is prob safer.

I'm convinced the shares will fall after peeps have qualified for their 200 pence divi.... since thats why the price has risen... anyone agree ?

[enami] 10/2/2006 09:00

bill see my post 79 I calculated 702 from the price at time of announcement

[bodyboarder_bill] 10/2/2006 08:55

Does anyone understand the consolidation and special dividend well enough to know what the 'break even' pre-consolidation price is i.e. how high should the price be today for it to make more sense to sell than to retain (assuming no tax effect)?

[maywillow] 09/2/2006 19:29

Boots Group Boots to pay 200p special dividend
LONDON (AFX) - Boots Group PLC said it has resolved to pay a special interim
dividend of 200 pence per ordinary share, subject to the consolidation of Boots
ordinary shares in the ratio 58 to 39 having become effective.
The consolidation is expected to take effect and the shares will trade
ex-dividend on Feb 13, the company said.
[e-mail]
slm

[a77] 08/2/2006 15:28

Investec recommends Boots as a 'buy'. The balance sheet has been strengthened by retaining some of the proceeds of the BHI sale to Reckitt Benckiser. The decision not to refer the Alliance Unichem merger to the Competition Commission shortens the window for a private equity approach, and if the merger goes ahead there are significant synergies and cost savings to be made.

[crontab] 07/2/2006 12:55

With a bit of luck they'll go to Tesco...

[miata] 07/2/2006 12:52

The OFT said it has identified around 100 areas where the presence of both a Boots and Unichem pharmacy could create a lessening of competition. It will clear the merger if they are sold.

OK.

[enami] 06/2/2006 17:45

Ben - They will realise the special div and consolidation is a poor deal when they have to pay 25% of the div to the taxman. I calculate that if the share price rises to 702 that a taxpayer may come out of this with a neutral capital position based on the share price at the time of the announcement.
Maybe the bid rumour has been started so that someone who wants to sell out before next Monday can buy back later and avoid a large tax bill, with just a minor CGT loss or gain to reckon.
It's OK if you hold in ISA or SIPP - you will end up no worse off.

[ben nevis] 06/2/2006 17:25

It obviously has pleased a lot of shareholders...
but have they really worked out if its a good deal ?

All depends I suppose on the share price after the dust has settled.

[ben nevis] 06/2/2006 13:21

Gryphon, that happens for normal dividends, where people dont lose any shares.

This is different; people will have far fewer shares afterwards at approx the same price I imagine.

ie. They are giving you some money - for some shares.

[sealed] 06/2/2006 10:25

Todays action is more likely being driven by the ST story:

[goliard] 06/2/2006 10:13

Boots looking strong today so maybe the OFT has been nice enough not to have a full investigation and just to ask for some of the ocmbined group stores to be sold off? It certainly looks like some news is leaking.

[gryphon2] 02/2/2006 07:59

technically the price will drop by the gross amount of the dividend which will be paid net of tax.

So a capital loss coule be expected but shares do not always fall by as much as the dividend

[gogs2] 18/1/2006 14:28

Having tried to digest what you state it would appear that after expenses and tax etc. that there would be an immediate loss on a transaction even with the £2.00 special dividend.. Am I correct?.

[gogs2] 18/1/2006 12:11

Thanks 9degrees.

[9degrees] 17/1/2006 21:01

The share price will stay the same but the existing shares are being cancelled and new shares issued on the basis of 39 new shares for 58 existing shares
So no change in value of holdings just less shares representing the value of cashback

[giwalker] 13/1/2006 14:35

Have been reading some of the recent posts.
Will the share price drop by the amount of the special dividend or has it already been factored in?

[mr.oz] 12/1/2006 07:36

Enami
yes - thanks for that reply

Boots Q3 tops market hopes

LONDON (AFX) - Boots Group PLC, the health and beauty retailer that
last
October proposed a "merger of equals" with Alliance Unichem PLC, has reported
better-than-expected Christmas sales along with improved gross margins.
For the three months to Dec 31 2005 like-for-like sales at the 1,400 outlet
Boots The Chemists (BTC) chain were down 0.7 pct compared with analysts'
consensus forecast of a 1.4 pct fall.
After taking account of the impact of the Pharmaceutical Price Regulation
Scheme (PPRS), introduced in January 2005, which reduced the price of branded
medicines by 7 pct, "underlying like-for-like sales" were up 0.3 pct.
Total BTC sales were up 1 pct. Within this the key health and beauty
categories performed well -- dispensing up 4.0 pct and beauty up 7.0 pct, thanks
to ranges like No 7. But sales in toiletries, where the supermarkets are
muscling in, were flat.
The chemist chain's gross margin improved year-on-year, in line with plan,
the company said, attributing the boost to more own brand products and better
buying.
In its planning for Christmas Boots bought less stock in value terms,
bought
more to offer at lower price points and did not enter into any last minute
Sales.
"Our plans for a seasonal offer focused more on our health and beauty
expertise with more products unique to Boots and more gifts at lower price
points delivered a fourth record Christmas," said chief executive Richard Baker.
"At the same time we improved our margin and working capital position and
kept costs under control."
Baker, who joined Boots from Asda in 2003, said the ongoing retail
environment remains tough and sees no signs of this easing in the short term.
Nevertheless he drew encouragement from the Christmas outturn.
"In a very active period for the group, it is pleasing that the core
business has remained focused and made good progress."
Boots retains its expectations for BTC's gross margin, operating costs and
working capital.
Following recent European Union clearance, the 1.93 bln stg disposal of
Boots Healthcare International (BHI), the over-the-counter medicines business,
to Reckitt Benckiser PLC, the Anglo-Dutch household products group, is expected
to complete at the end of January. The special dividend of 200 pence per share
will be paid to shareholders by Feb 24.
BHI's third quarter sales increased 4.3 pct on a comparable basis.
Boots Retail International continued to perform well with sales in the
quarter up 12.9 pct on a comparable basis.
Baker is under pressure because investors appear unconvinced about the
merits of the proposed merger with Alliance, which requires the approval of
shareholders of both groups as well as the regulators.
On Dec 16 Alliance published a trading statement detailing a robust
performance, particularly outside the UK.
Boots shares closed Wednesday at 637 pence, valuing the business at 4.6 bln
stg.

[enami] 11/1/2006 21:03

mr.oz - you would also have to pay tax on the special divi (£500) unless you hold in ISA. I have 6000 shares non ISA and plan to sell soon. If you read the RNS filings there have been plenty of short CFD written below 630 so I guess the price will be below that before the consolidation.

[mr.oz] 11/1/2006 20:40

re the consoldiation, Enami ,anyone...
... please explain where this doesn't add up

We get £2 per share on the qty of shares held "before" the consolidation
And then get our holding in terms of qty reduced by about a third after that.

So if I have 1000 shares
= £ 6300 pre consolidation

then upon divi + consol, etc

= £2000 special divi
but then would be left with 644 shares {(1000/59)X 38}
if share price still @ £6.30 = £4057

ie , I'm a loser with value totalling £6057 post consolidation

Surely the share price will not go UP!

[pentland] 11/1/2006 13:40

Enami Thank you very much for your help.
I Thought that it sounded to good to be true.I await the results tomorrow with interest.Numis securities and the weekend article seem to have opposing views.