Well you can rule that one out. I'm a CAML shareholder. I've written to Richard Morgan (IR) expressing my concern about incremental shareholder dilution.
Mr. Morgan said: "If we look at the past two and a half years, we see an increase in the average number of shares in issue (used to calculate earnings per share) of 0.83% in FY2022, 2.22% in FY2023 and 0.0% in H12024. These are extremely small increases"
Yes, but if you're a coffee canner instead of a stock flipper, still, over time, you see your shareholding nibbled at - and without need. Ok, call me fuzzy and having the wrong investment style and whatever.
In my answer I brought out the question of buy-backs - though fully knowing that at a recent presentation of results, when management was asked about buy-backs, they said sth. like: "Well, we pay a dividend"; specifically, I alluded to the positive effect of buy-backs: "This has been seen in coal mining in recent years, where, due to singular circumstances, the management teams could dramatically reduce the share count, leading to a corresponding significant increase in shareholder wealth".
But, again knowing about their dismissive answer about buy-backs, I didn't want to belabour the point and hence was only aiming for a stable share count: "my question would be, and not even envisaging buybacks to reduce the share count, would management contemplate buying back the shares they offer in employee incentives, to keep the share count stable? As I mentioned and you confirmed, it is not the cash that is lacking."
A reasonable question kindly worded, I daresay. No answer. One month later, I re-sent the question. Again, no answer.
As a minority shareholder I tend to judge the quality of management by the quality of IR (because by what else I could judge it with).
Sadly many companies ignore their shareholders or at least perhaps focus on the large ones only. The dilution is only 7% in 7 years so it is to some degree a philosophical question.
Looking at shareholder returns in that time (since 2018) I can see $1.572 returned in dividends, and the NAV is $44m higher which is worth $0.232 per share.
$1.804 is £1.39 per share.
So in a way I take their point about well "we pay a dividend". They sure do!
Thank you for the analysis, from a long-term holder of CAML, underwater at the moment, wondering whether to top up. I think I will wait till next week's results. Geopolitics is a handy excuse not to buy, but the management has been serious and solid and perhaps too secure to go for the blue-sky deals PIs love, but which nearly all fail. But this price does seem a bottom. I don't expect div to increase, but neither should it decrease. The latter would be a sell signal.
Acquiring Verkhuba makes perfect sense as deposit a decent size, open pit-able with smelter, roads and other infrastructure close by. Can't understand why Alex has not had a queue at his door for this asset.
"or perhaps even buy backs"
Well you can rule that one out. I'm a CAML shareholder. I've written to Richard Morgan (IR) expressing my concern about incremental shareholder dilution.
Mr. Morgan said: "If we look at the past two and a half years, we see an increase in the average number of shares in issue (used to calculate earnings per share) of 0.83% in FY2022, 2.22% in FY2023 and 0.0% in H12024. These are extremely small increases"
Yes, but if you're a coffee canner instead of a stock flipper, still, over time, you see your shareholding nibbled at - and without need. Ok, call me fuzzy and having the wrong investment style and whatever.
In my answer I brought out the question of buy-backs - though fully knowing that at a recent presentation of results, when management was asked about buy-backs, they said sth. like: "Well, we pay a dividend"; specifically, I alluded to the positive effect of buy-backs: "This has been seen in coal mining in recent years, where, due to singular circumstances, the management teams could dramatically reduce the share count, leading to a corresponding significant increase in shareholder wealth".
But, again knowing about their dismissive answer about buy-backs, I didn't want to belabour the point and hence was only aiming for a stable share count: "my question would be, and not even envisaging buybacks to reduce the share count, would management contemplate buying back the shares they offer in employee incentives, to keep the share count stable? As I mentioned and you confirmed, it is not the cash that is lacking."
A reasonable question kindly worded, I daresay. No answer. One month later, I re-sent the question. Again, no answer.
As a minority shareholder I tend to judge the quality of management by the quality of IR (because by what else I could judge it with).
Hi Simon,
Sadly many companies ignore their shareholders or at least perhaps focus on the large ones only. The dilution is only 7% in 7 years so it is to some degree a philosophical question.
Looking at shareholder returns in that time (since 2018) I can see $1.572 returned in dividends, and the NAV is $44m higher which is worth $0.232 per share.
$1.804 is £1.39 per share.
So in a way I take their point about well "we pay a dividend". They sure do!
OB
Thank you for the analysis, from a long-term holder of CAML, underwater at the moment, wondering whether to top up. I think I will wait till next week's results. Geopolitics is a handy excuse not to buy, but the management has been serious and solid and perhaps too secure to go for the blue-sky deals PIs love, but which nearly all fail. But this price does seem a bottom. I don't expect div to increase, but neither should it decrease. The latter would be a sell signal.
Acquiring Verkhuba makes perfect sense as deposit a decent size, open pit-able with smelter, roads and other infrastructure close by. Can't understand why Alex has not had a queue at his door for this asset.
Good luck with this. Hope it takes off like MAFL and THX and NOT so much like UUU!!!
Love Camels. Very expensive now though.
Great find!