Steppe Cement Share Discussion Threads

[wilo101] 04/2/2024 22:36:27

Kazakhstan has a 01.01 through 31.12 financial and tax year.

[danmart2] 04/2/2024 17:43:38

The Netherlands tax year is Jan to Dec so I don’t think it will be a factor in when dividends are paid.

Does anyone know the Kazakh and Malaysian tax year details?

[mattjos] 02/2/2024 14:31:52

I've made a modest addition here today.
This is pretty damn cheap now & seems to be so more out of impatience than the business fundamentals.
The CEO has stepped in around this level before now to add to his holding

[tigerbythetail] 02/2/2024 11:08:18

Evidently the structure doesn't work. Not for anybody.
I'm mystified as to why there is a Netherlands company between the Kazakhstan producing entity and topco.
I don't doubt that STCM in Kazakhstan is doing well. But the directors ought to be embarrassed by their failure to sort out this problem. It really isn't good enough.
(That is, unless it is all a charade whose purpose is to soften shareholders up for a lowball take-out offer. In which case the directors should be ashamed.).

[zangdook] 02/2/2024 08:49:15

Not sure that explains the Netherlands part

[rahosi] 02/2/2024 08:16:54

Can someone please elaborate why such a complex international corporate structure was put in place?

[danmart2] 01/2/2024 16:36:45

I do suspect they will announce the dividends before the summer, no obvious reason why it couldn’t be any day

[aleman] 01/2/2024 10:14:45

Kazakhstan manufacturing PMI rose from 48.6 in December to 50.5 in January.

Remember there was another 0.5% off interest rates in the middle of January but that's still about 6% above the falling inflation rate while the exchange rate (to $) has been stable for about 18 months. Presumably that leaves scope for more rate cuts. The cement market was already strong in Q4, with a couple of monthly volume records. I can see it getting even stronger and breaking more records in 2024, with prices recovering further to significantly enhance margins.

Shares should be going up - not down. If we ever get profit distribution sorted out, there should be a big jump.

[zangdook] 31/1/2024 17:10:25

If they could borrow money and use it for buybacks they could equally use it to pay dividends.

[aleman] 31/1/2024 17:02:28

There have been waivers for such things in the past, though it would start to make a listing a bit pointless pretty quickly. I think I'd rather see them invest in building another cement mill actually, maybe somewhere that can remit profits! Has that ever been discussed?

[mattjos] 31/1/2024 16:58:29

Buyback would risk existing largest investor(s) exceeding ownership % & therefore trigger mandatory Offer.
The biggest holders are so clearly a concert party given their prior working relationships

[aleman] 31/1/2024 16:56:35

With the shares so low, I don't know why they don't just announce share buy-backs. It would make sense at this level (potentially saving a 15-20% dividend in future) and with a lowish free float, arguably under 30%, then a £7m buyback would probably put a rocket under the shares. I think the holding company could maybe borrow the £7m while the cash remains stuck in Kazakhstan or the Netherlands or under somebody's mattress.

[fozzie] 31/1/2024 16:33:28

I will be happy to pick some more up c20p but agree that this tax/divi situation is taking far far too long to sort out.

[aleman] 31/1/2024 15:58:26

Trading well under a very solid book value of maybe £53m when H2 profit added. Well undervalued.

[zangdook] 31/1/2024 13:08:30

And likely to pay 10% to 15% dividend if they sort themselves out, plus at least that much going forward.

[danmart2] 31/1/2024 12:19:56

This is now in bargain territory, 20.9p a share , from a small market share decline!

[1knocker] 31/1/2024 10:54:06

I have never heard that one before, scrwal!
It would indeed be draconian if a company lawfully carried out a reconstruction which carried a lawful tax advantage under its tax legislation, and the tax authority then said 'Sorry chum, we are applying different tax rules to you'.

I think you may have in mind the UK rules abut seeking clearance for 'exotic' tax avoidance schemes. If clearance is granted after an honest disclosure, the tax payer is safe from penalties for tax evasion if the scheme is subsequently held ineffective to avoid tax. That is all. Clearance is not an assurance that the scheme will be treated as effective, and failure to apply for and obtain clearance does not deprive the taxpayer of the tax advantage of a scheme which proves to be legitimate and effective.

A company reconstruction would not itself come within the scope even of the UK 'exotic' tax avoidance rules, though a tax avoidance scheme (which the reconstruction might have been carried out to enable the scheme to be implemented) could be.

Be that as it may, i very much doubt the company contemplates anything which could be regarded as tax evasion. The only potential complication I see is that when paying tax in more than one jurisdiction care has to be taken that a reconstruction to reduce tax in one jurisdiction does not increase the tax in another by as much or more than the saving. but that should be fairly straightforward arithmetic for a tax accountant.

[scrwal] 29/1/2024 20:58:46

1knocker - depending on the rules etc for each tax jurisdictions there may be a legal obligation to obtain clearance for any form of reconstruction as is the case in the UK for some restructuring. You don't just restructure without clearance , if you tried that the tax authority could just say no even if it complied with all the legislation and you don't have a leg to stand on because you didn't apply for clearance , it's that draconian.

[tag57] 29/1/2024 19:09:16

1knocker - this may be the case if they are not looking to move tax jurisdictions, otherwise they will need to register with a new tax authority and obtain various tax docs to obtain acceptance from tax authorities further up the Corp structure to allow the pass through of cash distributions. It all takes time as most tax authorities are in no rush to accept changes such as these.

[1knocker] 29/1/2024 17:59:12

scrwal, no restructuring or distribution to shareholders requires 'positive agreement' from any tax authority.

The tax rules for the various jurisdictions define the fiscal consequences of any restructuring or distribution. 'Agreement with the tax authorities' does not enter the picture.

It is just a question of obtaining advice from appropriate tax advisers as to what scope there is for making tax efficient payments, and as to what (if any) restructuring or form of payment will be most beneficial. It should have been possible to obtain that advice within a matter of weeks, and to decide whether any possible scheme is worth the candle, and to inform the market and the shareholders of the decision within a matter of a few weeks thereafter. Qicker than that if the advisers' advice was 'no dice'!

[danmart2] 29/1/2024 14:04:48

Not beyond the means of possibility.

This looks like it’s heading below 20p

[zangdook] 29/1/2024 13:41:15

Assuming the money is in Kazakhstan, the only way they could do a buyback would be to find a seller willing to accept payment in Kazakhstan.

[eggbaconandbubble] 29/1/2024 13:29:57

No expert here, but couldn't they start a large buy back programme? Or as I suspect is Abu Wanhabiwotsit putting particular pressure on.