LLOYDS BANKING GROUP PLC - ANNUAL REPORT AND ACCOUNTS FOR THE YEAR ENDED 31 DECEMBER 2019

[idpickering]

Here; viewtopic.php?p=285555#p285555

[Wasron]

Dividend:

2.25p

Ex-div Apr 2nd
Paid May 27th

An increase of 5%

[daveh]

And the full results announcement can be found here:

https://www.investegate.co.uk/lloyds-ba ... 00075457D/

Significant strategic progress and the right strategy in the current environment
In 2018 we launched our ambitious strategy to transform the Group for success in a digital world; over the last two years we have invested £2 billion in strategic initiatives and:
· Invested in building a leading customer experience, including the Group's unique Single Customer View, supporting the largest digital bank in the UK with 16.4 million digitally active customers and 10.7 million mobile app users, alongside the largest branch network in the UK
· Enhanced comprehensive product range and maximised Group capabilities by launch of Schroders Personal Wealth
· Continued to digitise the Group and transform ways of working

Solid financial performance
· Underlying profit of £7.5 billion, down 7 per cent in a challenging external market
−Net income of £17.1 billion, down 4 per cent, with stable average interest-earning banking assets of £435 billion, net interest margin of 2.88 per cent and other income down 5 per cent to £5.7 billion
−Total costs of £8.3 billion further reduced by 5 per cent, driven by action to reduce operating costs, and lower remediation charges; market-leading cost:income ratio improved to 48.5 per cent with positive jaws of 1 per cent
− Credit quality remains strong with net asset quality ratio of 29 basis points
· Statutory profit after tax of £3.0 billion after £2.45 billion PPI charge and £1.4 billion tax expense in the year
· Total ordinary dividend of 3.37 pence per share, up 5 per cent
· Balance sheet strength maintained with free capital build of 86 basis points in the year (207 basis points pre-PPI charge) and CET1 ratio of 13.8 per cent after dividends
· The Group is targeting an ongoing CET1 capital ratio of c.12.5 per cent plus a management buffer of c.1 per cent.
· Sustainable growth in targeted segments including £1.0 billion in UK Motor Finance, £0.3 billion in SME and £3.2 billion in Retail current accounts, as well as growth of £3.5 billion in the open mortgage book, including the Tesco acquisition
· Underlying return on tangible equity remains strong at 14.8 per cent with statutory return on tangible equity at 7.8 per cent, largely driven by the PPI charge

Guidance for 2020 reflects the Group's confidence in the business model and future performance
· Net interest margin of 2.75 to 2.80 per cent
· Operating costs to be less than £7.7 billion with the cost:income ratio lower than in 2019
· Net asset quality ratio expected to be less than 30 basis points
· Capital build expected to be within the Group's ongoing guidance range of 170 to 200 basis points per year and risk-weighted assets to be broadly in line with 2019


· Expect increased statutory return on tangible equity of 12 to 13 per cent, driven by resilient underlying profit and lower below the line charges

There seems to have been yet another charge for PPI miss selling. I thought that had been finished with last year.


(edit for autocorrect misspelling miss selling)

[seagles]

There seems to have been yet another charge for PPI miss selling. I thought that had been finished with last year.


(edit for autocorrect misspelling miss selling)

mentioned here on BBC

[Breelander]

Of note is that they are changing to quarterly dividends in 2020.

The Group has announced that it will move to the payment of quarterly dividends in 2020, with the first quarterly dividend in respect of the first quarter of 2020 payable in June 2020. The new approach will be 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 continuing to deliver a full year dividend payment that reflects the Group's financial performance and its objective of a progressive and sustainable ordinary dividend. The final dividend will continue to be paid in May, following approval at the AGM. The Group believes that this approach will provide a more regular flow of dividend income to all shareholders whilst accelerating the receipt of payments.

And have effectively declared each of the 2020 Q1, Q2 and Q3 dividends to be 20% of the 2019 total dividend (4.33p) so that should be 0.866p each quarter.

[dealtn]

There seems to have been yet another charge for PPI miss selling. I thought that had been finished with last year.

These results are for the period 1/1/19 to 31/12/19. The PPI claims deadline ended on 31/8/19, so it's entirely appropriate to have a "charge" in this set of results.

[daveh]

Of note is that they are changing to quarterly dividends in 2020.

The Group has announced that it will move to the payment of quarterly dividends in 2020, with the first quarterly dividend in respect of the first quarter of 2020 payable in June 2020. The new approach will be 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 continuing to deliver a full year dividend payment that reflects the Group's financial performance and its objective of a progressive and sustainable ordinary dividend. The final dividend will continue to be paid in May, following approval at the AGM. The Group believes that this approach will provide a more regular flow of dividend income to all shareholders whilst accelerating the receipt of payments.

And have effectively declared each of the 2020 Q1, Q2 and Q3 dividends to be 20% of the 2019 total dividend (4.33p) so that should be 0.866p each quarter.

Except in the headlines to the report they say:

Total ordinary dividend of 3.37 pence per share, up 5 per cent

so the 1st there quarterly dividends are likely to be 0.674p per share.


Edit I've just checked and this years divi is 1.12 interim + 2.25 final just announced from my spreadsheet - no specials this year that I've seen.

[blobby]

The Annual Report is here:
https://www.lloydsbankinggroup.com/globalassets/documents/investors/2019/2019_lbg_annual_report.pdf
The “results news release” is here:
https://www.lloydsbankinggroup.com/globalassets/documents/investors/2019/2019_lbg_fy_results.pdf
I’m guessing that everything in the results (64 pages) is also in the Annual Report (341 pages).

[dealtn]

Of note is that they are changing to quarterly dividends in 2020.

The Group has announced that it will move to the payment of quarterly dividends in 2020, with the first quarterly dividend in respect of the first quarter of 2020 payable in June 2020. The new approach will be 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 continuing to deliver a full year dividend payment that reflects the Group's financial performance and its objective of a progressive and sustainable ordinary dividend. The final dividend will continue to be paid in May, following approval at the AGM. The Group believes that this approach will provide a more regular flow of dividend income to all shareholders whilst accelerating the receipt of payments.

And have effectively declared each of the 2020 Q1, Q2 and Q3 dividends to be 20% of the 2019 total dividend (4.33p) so that should be 0.866p each quarter.

Except in the headlines to the report they say:

Total ordinary dividend of 3.37 pence per share, up 5 per cent

so the 1st there quarterly dividends are likely to be 0.674p per share.


Edit I've just checked and this years divi is 1.12 interim + 2.25 final just announced from my spreadsheet - no specials this year that I've seen.

The dividends paid for the company year 2018 were (interim) 1.07p and (final) 2.14p giving a total of 3.21p.

The dividends for 2019 are (interim and paid) 1.12p and (final, announced but unpaid) of 2.25p, giving a total of 3.37p.

3.37p is a 5% increase on 3.21p.

The company anticipates making 4 dividends with respect to 2020, the first 3 announced now, as interims, being 20% each of the 2019 total dividend. So, if the proposed final dividend for 2019 of 2.25p is passed at the AGM (which is almost 100% likely), then the interim dividends will be 20% of 3.37p, which is 0.674p. The final dividend will depend on the (as currently unknown) performance of the company.

[idpickering]

The Annual Report is here:
https://www.lloydsbankinggroup.com/globalassets/documents/investors/2019/2019_lbg_annual_report.pdf
The “results news release” is here:
https://www.lloydsbankinggroup.com/globalassets/documents/investors/2019/2019_lbg_fy_results.pdf
I’m guessing that everything in the results (64 pages) is also in the Annual Report (341 pages).

Hence my losing the will to live earlier, and my trimmed down opening post. They don’t make it easy some of them. Its like wading through treacle sometimes.

I hold these, and might top up soon.

Ian.

[Breelander]

so the 1st there quarterly dividends are likely to be 0.674p per share.

You're right. I'd typed the wrong figure for the final dividend into my spreadsheet....

Thanks for pointing out my mistake.

[blobby]

Overall I’m disappointed with the results. Lloyds is one of my largest investments and it has not done as well as I had hoped. Statutory profit after tax is down 33% which is not what I wanted. They are saying this is “largely” due to PPI but it is disappointing that they seem to be standing still or going backwards slightly when you take PPI out of the equation.

I still think it is very good value at the level though, 6% yield with a progressive dividend policy and I’m guessing at a forward p/e of about 10 and TNAV about the same as the market cap. Management has gone down a little in my estimation but I still think they are good.

[tjh290633]

For those of you who lost the will to live, after several repetitive sections in the RNS, the calendar for the first 3 quarterly dividends is:

The key dates for the payment of the three interim dividends are:
                                                                 
First interim dividend                                           
Shares quoted ex-dividend                                           4 June 2020    
Record date                                                         5 June 2020      
Final date for joining or leaving the dividend reinvestment plan    19 June 2020    
Dividends paid                                                      30 June 2020     
                                                                 
Second interim dividend                                          
Shares quoted ex-dividend                                            6 August 2020  
Record date                                                          7 August 2020    
Final date for joining or leaving the dividend reinvestment plan    21 August 2020  
Dividends paid                                                       14 September 2020
                                                                 
Third interim dividend                                           
Shares quoted ex-dividend                                            5 November 2020
Record date                                                          6 November 2020  
Final date for joining or leaving the dividend reinvestment plan    20 November 2020
Dividends paid                                                       11 December 2020

I assume that they think the first three quarterly dividends have now been announced.

TJH

[monabri]

We have to hope that "post-PPI" they will be able to uplift the final in 2021.



[So, for someone "buying today", in calendar year 2020, one can expects a total of 4.272p (2.25p + 3 interim dividends). On a share price of 57.6p, a yield of 7.4%].

[scrumpyjack]

No, the 2.25p final is when they were paying 2 divis a year. Moving to 4 divis a year, I would expect the final to be 1.348p plus whatever increase they consider appropriate. Perhaps 5% or 10% of the annual total of 3.37p in 2019

I didn't see anything in their results that suggested they were planning a 27% increase in dividend for 2020, which is what would be the case if they paid a 2.25p final as well as the 3 interims?

[monabri]

No, the 2.25p final is when they were paying 2 divis a year. Moving to 4 divis a year, I would expect the final to be 1.348p plus whatever increase they consider appropriate. Perhaps 5% or 10% of the annual total of 3.37p in 2019

I didn't see anything in their results that suggested they were planning a 27% increase in dividend for 2020, which is what would be the case if they paid a 2.25p final as well as the 3 interims?

Assuming you were responding to the table I posted (?)

- We have todays 2.25p Final divi. in line 2 of the table (I also gave the previous interim).

- I don't know what the TBA values will be 2021.

- I mentioned calendar year (i.e 2020). maybe I should have said "payments in calendar year" ?

[scrumpyjack]

OK sorry I didn't pay enough attention!

[idpickering]

No, the 2.25p final is when they were paying 2 divis a year. Moving to 4 divis a year, I would expect the final to be 1.348p plus whatever increase they consider appropriate. Perhaps 5% or 10% of the annual total of 3.37p in 2019

I didn't see anything in their results that suggested they were planning a 27% increase in dividend for 2020, which is what would be the case if they paid a 2.25p final as well as the 3 interims?

Assuming you were responding to the table I posted (?)

- We have todays 2.25p Final divi. in line 2 of the table (I also gave the previous interim).

- I don't know what the TBA values will be 2021.

- I mentioned calendar year (i.e 2020). maybe I should have said "payments in calendar year" ?

Thanks for that table. A picture speaks more than thousand words.

Ian

[monabri]

OK sorry I didn't pay enough attention!

No, I thank you...I should have been a bit clearer......anyway !