Standard Life Aberdeen Share Discussion Threads

[jaws6] 06/8/2018 13:35

some info here

[essentialinvestor] 06/8/2018 13:32

SLA lost another mandate last week - St James's Place £286 Million
ethical fund going to Impax Asset Management.

[pierre oreilly] 06/8/2018 13:25

Have you got a link to where this is explained or where you got this information from?

The idea is that it is a cashback to shareholders, and to be that the shares must be purchased in the market, just as the rns says and is my experience of lots of these things.

The buys will be rnsd on the day or the next day of purchase, so we soon shall see.

[scrwal] 06/8/2018 12:37

The buy back will be "on-market purchase" but is likely to be done after the close of the market each day for any large tranches to avoid inadvertent market manipulation issues owing to the market not immediately knowing who has made the purchase and all the rumour mongering etc that could ensue.

[stewart64] 06/8/2018 09:00

Scrwal...thanks I had been under the wrong impression that the recording day had gone because the original timetable was 26th June.

[pierre oreilly] 06/8/2018 08:44

It states that in the rns.

[pierre oreilly] 06/8/2018 08:44

Scrawl, not sure where you get your info about some weird selective buyback, but I can assure you it's incorrect. The buyback will be by normal market purchases.

[chinese investor] 06/8/2018 08:27

Good Recovery !

[unastubbs] 05/8/2018 02:10

thank you to all for the continued excellent input. scrwal - i had been having similar thoughts to your own good advice about buying proportionately more shares to that which i actually require. i am an income investor (usually!) and was looking at taking £1200 per year from SLA, so it's a fairly easy calculation to see what i need to buy now to be left with that amount of shares to provide said amount (at the current dividend rate). i'm going to to wait for the results however before i act.

as to the buyback, i don't see why they can't use the open market. with the share price being what it is, it's a perfect opportunity. that said, i held SL post brexit vote when it (and L&G) were punished without any cause whatsoever. i made plenty out of buying them then, though sold too early in hindsight. so there might be lower lows here...wait for the update i think! thanks again fellows.

[scrwal] 04/8/2018 16:00

The £0.75bn buyback won't be on the open market. It is usually targeted at institutions and those individual investors who have bought shares using schemes run by a company itself. SLA has its own share portal scheme which is presumably linked to a broker and it is able to "target" these holdings ,effectively giving them priority as to whether or nor accept any buyback offer from the company.

None of the consolidation or buyback has taken place yet.The consolidation should take place in the 3rd qtr 2018 which presumably is July to Sept which also coincides with the current shares going xd and being paid on 25 Sept which to me isn't ideal timing.

The share buyback will be done as and when shareholders want to sell their holdings basically. It may well be possible that the buyback is stopped because there has been insufficient uptake which is more likely in a falling market.

As regards the half year results Motley Fool had this to say today
" Its market value has shrunk 30% since then, Lloyds Banking Group’s decision to cancel a £109bn asset management contract in February setting the tone. The move forced investors to seriously reconsider the implications of last summer’s Standard Life-Aberdeen Asset Management tie-up, and Lloyds’ further decision to sell its 3.3% stake in the group in June has hardly improved sentiment either.

It is quite possible that the share price rout could be extended when interim results are released on Tuesday. Most commentators are anticipating a scary update, with UBS for one expecting the asset manager to report outflows of £20bn between January and June.

However, it could also be argued that Standard Life Aberdeen’s ultra-low valuation — a forward P/E ratio of 12.2 times — compared with those of its peers more than prices in the possibility of bad trading news."
The price drop is since the turn of the year.

[stewart64] 04/8/2018 11:46

I have come to SL post consolidation. I understand the one billion B share issuance was by reducing shareholdings so that the share price before and after recording day is comparing apples with apples with no xd style adjustment necessary or adjustment in eps.

Unclear on the phase two share buyback of 0.75 billion. Is this SL buying its own shares in the open Market and ripping them up over months/ years or has it already occurred/ going to occur by way of share reduction and separate payment.

I can find no satisfactory explanation in plain English most especially Standard Life's unintelligible help sheet.

[scrwal] 03/8/2018 13:23

unastubbs - a consolidation scheme affects all shareholders so the £1bn is spread amongst all of them . A share buy back is targeted at specific holders only.
The thing is a bit fiddly especially with an interim dividend in the pipeline - I would have done the consolidation before the interim which would have saved cash because the total div paid would be lower.
Depending on the timing of the consolidation and if you want to forgo the interim div it should be possible to buy the shares xc ie the market price will have been reduced by the b share price. This means you would have bought more shares but when the consolidation takes effect the holding will be reduced to what it would have been if there was no consolidation etc. Doing it this way may mean you end up with marginally more shares then if you buy now and top up the reduced holding with the b proceeds as you don't get caught having to pay the usual buying costs on the top up.

I said that the b price may be 31p because that is what it needs to be to create the neutral position of the share price because the actual number of shares cancelled is now much higher. You are correct in that it should be a static 33.4p but it is the boards fault in stating that it is £1bn to be returned - they should have said an approx figure to be confirmed because the figures they were using are now out of whack. If the 33.4p is to be used then the xc price will be even lower.

[unastubbs] 03/8/2018 06:17

answered my own question re. tax treatment:

The Finance Bill published on 24 March 2015 includes draft legislation to amend the Income Tax (Trading and Other Income) Act 2005 so that where shareholders are given a choice as to the nature of the return, the cash received will be treated in the same way as dividend income.

www.fladgate.com/2015/03/finance-bill-2015-changes-to-the-tax-treatment-of-b-share-schemes/

also -reading previous posts it seems clear that the cash is simply deposited in the account a few weeks later. good.

notice also that there will be a share consolidation, so will need to buy back shares to retain the same income stream. from a personal pov it's all a bit fiddly and i wd have preferred them to do a buyback and invest in the business. anyone any views on the advantages of this scheme??

I'm in Bali! Off to the beach now! Keep it there guys, this is a good board!

[unastubbs] 03/8/2018 06:04

surely (and please do correct me because i am looking for clarification myself) but surely the 33.4p figure is static and not related to the share price. it's all about returning £1b to shareholders via this b scheme. therefore 33.4p times the number of shares in issue (which number i do not have to hand) will equal £1b. the lower share price since the b scheme announcement is good news in one sense - the £750m buyback will garner more shares and thus raise the eps...in theory!

could anyone identify the tax issues related to b share schemes now - post the 2015 reforms? i know GSK were thinking of doing one in 2015 (announced in 2014) but the new legislation led them to back off and just issue a special div. unsure why SLA are taking this route. (i know they had one in 2015 which was presumably succesful)

also, anyone with experience of b share schemes - if one holds in nominee a/c - does the cash just pitch up in your account one morning?

i am a genuine novice in this area and so any info wd be highly appreciated!

PS - have no position here as yet but tempted by the yield - just don't want things to get complicated once this scheme goes ahead - thanks chaps!

[scrwal] 02/8/2018 17:17

p49b Yes it was 33.4p per B share but that was based on the 10/11ths and price of 367.4p . It may be the B share price falls to 31p.
When the circular came out the price was 367.4p and mkt cap of £10.95bn. Those are now 304.2p and £9.2bn before the £1bn consolidation and the £750m share buy backs. So if the price doesn't shift a lot the cap value of the company would have fallen from £10.95bn to £7.5bn which is massive. The eps should jump and if profits somehow remain constant there will be a lot of cash swilling around to pay down more debt and increase the div.

[essentialinvestor] 02/8/2018 16:37

Mentioned previously the outlook for large scale active management
looks challenging . SLA may be worth watching, just be aware
of the sector backdrop.

[p49b] 02/8/2018 16:24

I think i read that there would be 33p + share , then share cosolidation, and buy back of 750m, or there abouts.

[joshuam] 02/8/2018 16:14

Interim results out on the 7 th we need something positive

[scrwal] 31/7/2018 13:12

I too haven't invested but want to. I might take advantage of getting the interim div but one thing putting me off (apart from the downward shift) is the impact of the share consolidation and the need to reinvest the money back into SLA to maintain the div in £s terms. As far as I can see the original reduction in shares was based on a 10/11ths ratio but given how the price has fallen this is now nearer to 8/9ths.
I too am waiting for the results but also the timing of the consolidation.
The share price was 367.4p when the consolidation was announced and the mkt value was c£10.95bn. When the price dropped to 308.1p the value was c£9.2bn with a total buyback of £1.75bn which now seems far too much.

[cmackay] 31/7/2018 09:31

Indeed Salpara111, it does seem to swing about. I'm recently in for a small block and a little under so far but happy to let it grow in my isa from here.

[salpara111] 29/7/2018 12:49

Not invested but watching for the results.
Market sentiment swings from irrational exuberance to pessimism so a decent set of results could see them back to 400 in short order.

[mavis5] 26/7/2018 16:26

The vast majority of recent broker notes have "buy" recommendations with target share prices of well over 400p (including Deutsche who came out this week with 415p). Maybe this is a good buying opportunity. I've just bought at 305p to double my holding. Of course HY results could undermine all this! Good luck whichever way you go.

[wllmherk] 26/7/2018 15:51

Chart looks like a very steep ski slope, I really hope HY results on 7th August arrest the decline.

wllm

[wllmherk] 26/7/2018 15:48

To be honest I always saw SL. and subsequently SLA as a fairly defensive stock, but, the current weakness in the share price is either an overreaction to the Scottish Widows issue or something is wrong and the market knows. Either way my folio is visiting lows for the year, not helped by my other core holdings VOD and DLG.

wllm

[essentialinvestor] 25/7/2018 18:30

The market focusses on dividend sustainability (and growth).
Sometimes it gets this wrong-RDSB is a prime recent example.
Often price declines forerun deteriorating fundamentals, it has to be said.