Lloyds Banking Group Half Year Results.

[idpickering]

Good financial performance with market leading efficiency and returns

· Statutory profit after tax of £2.2 billion with strong return on tangible equity of 11.5 per cent; earnings per share of 2.7 pence

· Robust underlying profit of £4.2 billion with slightly lower net income and expected higher impairment offset by lower total costs

· Net income of £8.8 billion with a resilient net interest margin of 2.90 per cent, slightly lower average interest earning banking assets and other income, with other income benefiting from strong performance in Insurance and Wealth

· Total costs of £4.0 billion down 5 per cent with operating costs down 3 per cent and remediation down 44 per cent. Market leading cost:income ratio further improved to 45.9 per cent and positive jaws of 3 per cent

· Credit quality remains strong with a net asset quality ratio of 26 basis points.

· Additional PPI charge of £550 million in the second quarter driven by significant increase in information request volumes in the second quarter, ahead of the August deadline

· Tangible net assets per share of 53.0 pence

· Interim ordinary dividend of 1.12 pence per share, up 5 per cent, in line with our progressive and sustainable policy

And later;

Dividend

In respect of the first half of 2019, the Board has announced an interim ordinary dividend of 1.12 pence per share, an increase of 5 per cent on prior year and in line with the progressive and sustainable ordinary dividend policy.

The Board will continue to give due consideration at each year end to the return of any surplus capital. In February this year, the Board decided to return surplus capital through a share buyback programme of up to £1.75 billion. This commenced in March 2019 and at the time of issuing results is c.50 per cent complete having purchased c.1.4 billion shares.

The Group announced in May 2019 that it would move to the payment of quarterly dividends in 2020 in order to accelerate payment of dividends to all shareholders. The Group intends to adopt three equal interim ordinary dividend payments for the first three quarters of the year followed by, subject to performance, a larger final dividend for the fourth quarter of the year. The first three quarterly payments, payable in June, September and December will be 20 per cent of the previous year's total ordinary dividend per share. The fourth quarter payment will be announced with the full year results, with the amount reflecting the Group's financial performance and our objective of a progressive and sustainable ordinary dividend. The final dividend will continue to be paid in May, following approval at the Annual General Meeting.

https://www.investegate.co.uk/lloyds-ba ... 00182837H/

[monabri]

Shares quoted ex-dividend 8 August 2019

Interim dividend paid 13 September 2019

Interim ordinary dividend of 1.12 pence per share, up 5 per cent.

[idpickering]

Thank you monabri. It took me over half an hour to put all the reports up for today that might be of interest here, and I lose the will to live after wading through the reports. Back to Lloyds though, down 3.4% on market opening. I often wonder why I bother holding them to be honest.

Ian.

[funduffer]

Thank you monabri. It took me over half an hour to put all the reports up for today that might be of interest here, and I lose the will to live after wading through the reports. Back to Lloyds though, down 3.4% on market opening. I often wonder why I bother holding them to be honest.

Ian.

I stomach LLOY, because they yield 5.7% and increase their dividend each year, unlike several other HYP favourites.

My dividend CAGR in the couple of years I have held them in my HYP was a lacklustre 1.7% (higher if you discount the 2017 special), so a 5% increase is most welcome, and easily outstrips inflation.

If the dividend carries on increasing the share price will most likely follow.

FD

[monabri]

Thank you monabri. It took me over half an hour to put all the reports up for today that might be of interest here, and I lose the will to live after wading through the reports. Back to Lloyds though, down 3.4% on market opening. I often wonder why I bother holding them to be honest.

Ian.

You're going on the naughty step!

[idpickering]

Thank you monabri. It took me over half an hour to put all the reports up for today that might be of interest here, and I lose the will to live after wading through the reports. Back to Lloyds though, down 3.4% on market opening. I often wonder why I bother holding them to be honest.

Ian.

You're going on the naughty step!

Oooer.... In fact, as funduffer said above, I hold for the dividend too, but the minus 20% capital return is galling to look at.

Ian.

[SuperCally]

“The first three quarterly payments, payable in June, September and December...”

“The final dividend will continue to be paid in May...”

That doesn’t seem correct. Does it really mean that there will be the “current” final dividend in May 2020, followed by quarterlies in June, September and December, and the first “new” final in MARCH 2021?

[PinkDalek]

That doesn’t seem correct. Does it really mean that there will be the “current” final dividend in May 2020, followed by quarterlies in June, September and December, and the first “new” final in MARCH 2021?

No, I think they mean May 2021 for the final, a week or so following the AGM.

[Arborbridge]

Thank you monabri. It took me over half an hour to put all the reports up for today that might be of interest here, and I lose the will to live after wading through the reports. Back to Lloyds though, down 3.4% on market opening. I often wonder why I bother holding them to be honest.

Ian.

You're going on the naughty step!

Oooer.... In fact, as funduffer said above, I hold for the dividend too, but the minus 20% capital return is galling to look at.

Ian.

Probably best not to look, then Having been through the really bad times with Lloyds, I'm not about to give up just as the dividends roll in again. And as to that capital reduction - at least I still have some, and it will hopefully recover. If I had funded my pension with an annuity, I'd would have written off all the lloyds capital, presumably.

Investing in HYP was certainly the right thing for me, compared with the annuity alternative.

Arb.

[idpickering]

Probably best not to look, then Having been through the really bad times with Lloyds, I'm not about to give up just as the dividends roll in again. And as to that capital reduction - at least I still have some, and it will hopefully recover. If I had funded my pension with an annuity, I'd would have written off all the lloyds capital, presumably.

Investing in HYP was certainly the right thing for me, compared with the annuity alternative.

Arb.

You are, of course, correct Arb. Capital returns are immaterial in HYPing. It’s about the income.

Ian.

[Gengulphus]

“The first three quarterly payments, payable in June, September and December...”

“The final dividend will continue to be paid in May...”

That doesn’t seem correct. Does it really mean that there will be the “current” final dividend in May 2020, followed by quarterlies in June, September and December, and the first “new” final in MARCH 2021?

No, I'm fairly certain that they're saying that the current dividend payment schedule, which is to make dividend payments for each company financial year (which is just the calendar year for Lloyds) as follows:

* Interim in September of that year;
* Final in May of the following year;

will change to the new schedule for the years 2020 onwards:

* Three quarterlies in June, September and December of that year;
* Final in May of the following year.

So the first final paid according to the new schedule will be the one for 2020, which will be paid in May 2021. The reason why it's May 2021 and not March 2021 is almost certainly the administrative delays associated with paying final dividends: for the quarterly dividends, they just need to prepare the accounts for the quarter, decide on the dividend to be paid, declare it and then go through the admin of actually paying it. For the final, there are the extra steps of getting the accounts audited and calling (with adequate notice) and holding the AGM to approve it, which seem to add about 2 months to the process. This is also the basic reason why the current schedule has 4- and 8-month gaps between payments, rather than 6-month gaps, and those gaps are also probably the basic justification for the final dividend being about twice the interim dividend - you have to wait twice as long after the last payment to get it, but it's twice as big when it does finally arrive. The new schedule has 1/3/3/5-month gaps between payments, and a roughly 1:1:1:2 split of the total between them - not by any means a perfect fit between the length of time one waits and how large the payment is when it does arrive, but there is some effort in that direction.

Gengulphus

[johnhemming]

They seems to be trading now just under net tangible asset value.

[Breelander]

Thank you monabri. It took me over half an hour to put all the reports up for today that might be of interest here, and I lose the will to live after wading through the reports....

You wouldn't have found the dates anyway, they are in a 'Part 2'

https://www.investegate.co.uk/lloyds-ba ... 00182838H/

[idpickering]

Thank you monabri. It took me over half an hour to put all the reports up for today that might be of interest here, and I lose the will to live after wading through the reports....

You wouldn't have found the dates anyway, they are in a 'Part 2'

https://www.investegate.co.uk/lloyds-ba ... 00182838H/

Of course Breelander, thank you. I got waylaid with the other share results. To get back on topic, I shall continue to hold Lloyd's, concentrating on the dividend, as I should as a HYPer. I have a full holding of them, and am not considering buying any more.

Ian.

[monabri]

The "contents" page in part 1 told me the page number for "Key dates for the payment of the dividends: page 112". Handy!