Saturday, October 9, 2010

BTL dividend to be roughly 4.5%


Dividend is expected to be 4 1/2 %. So I think I´ll stick with my six month Bank CD´s that pay a little better than that.

Adele Ramos did the research and in a weekend article in the Amandala I gleaned the following facts. There are 45 million shares of a general nature to be sold. Last time the Belize public did not buy BTL shares when offered. Barrow as the Government of Belize, is going to discount the calculated share price by $1, whatever the price will be for shares of BTL. The business tax will be cut from 25% to 19% as an incentive to make profits. Tax on dividends of corporations in Belize will be eliminated totally. 1000 Belizeans are now shareholders of BTL. This is about 6% of the company. No board of director seats going to private Belizean small shareholders. There goes my grandson´s dream! The Social Security Board WILL BUY $50 million worth of shares in BTL. The Prime Minister has the majority votes on the SSB Dividend Committee and if they want to keep their perks and jobs, they better do what he wants. DONE DEAL ! The last reported BOOK VALUE of BTL was about $178 million. Nothing much has actually changed as to assets, so it should be the same or less.

Given Adele´s research in the Amandala newspaper article, then with the quoted current CEO saying net profit will be about $15 million per year, without the accommodation agreement and Government subsidizing the dividend. Now we can do some calculations in simple arithmetic. 45 million shares will equate to $4 a share. With a dollar discount the sale price would be roughly $3 a share to Belizeans. With an expected annual net profit of $15 million that works out to .33 cents a share. So take off 45% of that for our dividend equals .14 cents per share. Divide the cost of the shares at $3 with our discount, by .14 cents, you get about 4 1/2 % dividend. The bank CD´s are paying currently 7.5 %. You can get that across the border in Melchor in Guatemala too. So guess I´ll skip the BTL shares as the money would be tied up, without any public auction ability to trade, or buy and sell your shares should you need that money for some emergency. Whereas a C.D. at the bank you can cash it in any time.
So much for that deal! FINISHED.

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