Reflec Share Discussion Threads

[philmac56] 04/2/2013 08:11

Man 1

That's another idea, but would it boost value,as the board would like to o!!!

[man1] 03/2/2013 16:57

Hi All,
My share buy back was plucked from the air . i dont know about the rest .But as i can see we have 14600 shares approx each @ 165 giving us a market cap of 2.4 mil. Each divi pay out costs us 14600 x 3 =£43800 ish .
we have bout 500k cash at hand i think for rainy days ..
But if the company buys back 600 shares =99000
then each share wud be worth 2.4 / 14000 = 171.4 per share.
Or do we just issue a special divi at £6 per share costing £87600 and leave the shares alone ?

[philmac56] 02/2/2013 08:29

Hi all

Well we may know soon enough, as to what is in store..

Do/will we as shareholders get a vote on it, as we are not regulated by the LSE????(IF my understanding is correct)

please correct me if i am wrong!! DYOR

[darias] 01/2/2013 22:55

AnscI am not changing the playing field. If the company has 1.5mill to spend on a share buy back. It could pay a dividend of 1500 pounds a share and be in exactly the same financial position as if it had done the buy back.Simples

[ansc] 01/2/2013 22:07

I'm a tad confused by your reply, Darias, [1018] as you appear to have changed the playing field conditions. In your original illustration [1014], the divi was just £1/share so making a total payout of £1,000. In the second calculation, the divi total has jumped to £1,500,000 which of course makes it a completely different ball-game. If, however, the divi was kept at £1/share, or a total of £1,000 as before, buying back 100 shares costs £1,500,000; add in the £1,000 divi and the capital value has reduced by a total of £1,501,000 to £13,499,000. With only 900 shares now in issue, the assets/share are virtually the same as before the buyback i.e. a touch under £15,000/share.

Hi scalie. It's a genuine offer. If you read my post [@ 928] on 16 June, you'll see that my entire holding was placed on offer with J P Jenkins at £150 each. During the following six months, I received one offer at £148.50 each but by now reflec's auditors had provisionally valued each share at £165 so I turned that offer down. The shares are still on offer with LMMV at that increased price but, as I said at the time, I'd be happy to trade off-market through man1 as an intermediary.

[scalie] 01/2/2013 20:39

ansc - average down on Ref - now there is something i have done plenty of times over the years, Must admit i had not thought about it at this price - was that a genuine offer ? Regards, Scalie

[darias] 01/2/2013 17:49

The thing is that buying back shares does not increase market value, it does not buy new machinery or stock, employs no additional labour nor does it take over another company.

It is a financial instrument merely playing with money!

[darias] 01/2/2013 17:37

ansc

Anything to oblige.

Our hypothetical company has 1000 shares and is capitalised ,by the market, at 15m therefore the company yield at £1 divi a share is 0.0067% as each share is worth £15000

Now if it can afford to spend £1,500,000 to purchase 100 shares its capitalisation in theory should reduce by 1.5m and each share that is worth £15000 should have a reduced market value. The company has £1.5m less to spend on divi or has to borrow 1.5m.

Now let us say the company pays out £1,500,000 in dividend to its 1000 shareholders then the return to the share holders would be 10% at 15mill capitalisation.

However in theory if the company bought 100 share its market cap should reduce so the value of the shares should also reduce to £13,500 per share and the yield on the new value will increase to 0.0074% but capital value of the share will reduce by 10%.

The problem is that market cap is a product of emotion/crowd theory etc. Whereas money is hard cash. If the shareholders don't think it is worth buying more shares in the company and therefore increasing its market cap why should the board consider that they know better than the shareholders.

I have tried to make the maths as clear as possible.

[ansc] 01/2/2013 15:57

My maths isn't so hot these days so would you be good enough to work out the percentage assets change for our hypothetical company which is capitalised at £15mil for their 1,000 shares.

Thanks.

[darias] 01/2/2013 14:19

Dont agree with,

"the company's assets per share will have also increased by 10%"

Not necessarily as in our theoretical model £15000 of assets would have been spent.

[ansc] 01/2/2013 12:02

On the other hand, earnings per share will have gone up 10% which (in theory) should give the remaining shareholders higher future divis and, probably even more importantly, the company's assets per share will have also increased by 10% making it more attractive to possible suitors.

Swings and roundabouts.

[darias] 01/2/2013 09:42

Man1

The fly in the ointment which you are ignoring is that if we have 1000 shares and pay £1000 divi each share will get £1 however if we buy 100 shares at current price of £150 it means that we will have £15,000 less to pay less divi.

In other words if we can afford to buy back 100 shares we can afford £15 additional divi for the 1000 shareholders!

[philmac56] 01/2/2013 08:52

man 1

i fully understand why/what we would gain, but i have a price at 350

[man1] 31/1/2013 19:28

Hi guys ,
If no other plans are put forward i am all for a share buyback scheme .

For those who dont understand how it works here it is in simplistic form.

If we had a company with
1000 shares and paid a divi of £1000 a year
each one share would get £1 divi.

so if the company buy back 100 shares so we only have 900 shares but still pay £1000 divi then each share would be worth 1000 divided by 900 = £1.11 .

so the more shares we buy back the bigger the divi..

Hopefully then the share price will start to look after itself.

[man1] 31/1/2013 19:28

Hi guys ,
If no other plans are put forward i am all for a share buyback scheme .

For those who dont understand how it works here it is in simplistic form.

If we had a company with
1000 shares and paid a divi of £1000 a year
each one share would get £1 divi.

so if the company buy back 100 shares so we only have 900 shares but still pay £1000 divi then each share would be worth 1000 divided by 900 = £1.11 .

so the more shares we buy back the bigger the divi..

Hopefully then the share price will start to look after itself.

[ansc] 31/1/2013 09:07

scalie: Mine are on offer at a mere £165 so, if you want to average down, I'll be only too happy to negotiate and feel sure we can come to some amicable arrangement!! (lol)

[philmac56] 30/1/2013 19:38

scalie

you probably will have some wait!!!!

BUT you never know!!!!

[philmac56] 30/1/2013 08:40

scalie, i did not suggest it, but they can have my shares at £350 each!!!!!!

then cancel them if they want to

[upthepool] 30/1/2013 08:30

scalie;

not me - but a share buy back and cancellation wouldn't affect your share holding as the company buys the shares people want to sell and then cancels them

[scalie] 29/1/2013 20:31

Just getting myself up to date with this share and i have read the Reflect Plc
news Dec 2012. Ref say they have received a number of suggestions from shareholders re building value etc in the share ....goes on to say one of the suggestions is a share buy back and cancellation programme..wtf. Anyone on here suggest that or does anyone know anyone who does, At this rate i will not have any left - thanks, Scalie

[philmac56] 23/1/2013 19:11

Maz

The last traded price via JP was £150, for 6 shares.

None been traded since, the Company (Reflec) i think have suggested that the fair value for the shares should be in the region of £165, alas none have been traded at that price. DYOR etc....

Time will tell, the Company mentioned some idea's in the recent update at xmas with the divi to enhance the shre value...time will tell

[mazarin] 23/1/2013 15:43

Thanks John for your response. I've just discovered by trolling through related thread that REF can just about be 'traded' on 'matched price' basis through JP Jenkins. I'll check them out as my consolidated holding was 200 and may be worth following up

[johndee] 23/1/2013 15:33

Most just have a handful of shares that you could count on your fingers. £165 each at the moment I am told.