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Imperial Brands (IMB)

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idpickering
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Imperial Brands (IMB)

#210385

Postby idpickering » March 26th, 2019, 12:53 pm

This from TMF, written by Manika Premsingh;

I’d buy Imperial Brands’ shares today, despite its challenges

The Imperial Brands (LSE: IMB) share price has had a good start in 2019. However, it is still way off its longer-term potential. To put this in perspective, its average share price in 2019 so far is 8.5% less than its five-year average price. And this is despite the fact that the company operates in the consumer defensives sector, which I believe, should ideally have seen a sharper uptick during the present time of Brexit driven macro-economic uncertainty.

That makes it a curious case, which needs to be unravelled to figure out if this is a worthwhile investment or not.


https://www.fool.co.uk/investing/2019/0 ... hallenges/

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Imperial Brands (IMB)

#210547

Postby idpickering » March 27th, 2019, 7:03 am

Imperial Brands PLC issues the following trading update ahead of its close period on 1 April 2019.

We confirm we are on track to meet constant currency net revenue and earnings expectations for the full year, with Group net revenue growth at, or above, the upper end of our 1-4% revenue growth range and EPS growth within our 4-8% guidance range.


https://www.investegate.co.uk/imperial- ... 00021403U/

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Re: Imperial Brands (IMB)

#215360

Postby idpickering » April 16th, 2019, 10:53 am

This from TMF, written by Kevin Godbold;

Is Imperial Brands’ 8% dividend yield safe?

Since peaking in the summer of 2016, Imperial Brands (LSE: IMB) has seen its share price fall by around 40% and the ‘adjustment’ has driven up the forward-looking dividend yield for the current trading year to more than 8%. That looks tempting to me, but yields above 7% make me nervous because I fear they could be trimmed in the future.

However, the manufacturer and distributor of products for smokers (and for those who want to give up the habit) released a bullish-sounding trading update last month. It expects to deliver growth of at least 4% in revenue for the current trading year to September and earnings around 8% or more higher.


https://www.fool.co.uk/investing/2019/0 ... ield-safe/

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Re: Imperial Brands PLC (IMB)

#218469

Postby PinkDalek » April 30th, 2019, 2:37 pm

Intention to sell Worldwide Premium Cigar Business
Released 14:30 30-Apr-2019

Imperial Brands PLC confirms intention to sell Worldwide Premium Cigar Business

Imperial Brands PLC ("Imperial") today confirms its intention to sell its worldwide premium cigar business ("Premium Cigars") as part of its divestment programme. The programme supports Imperial's ongoing simplification agenda and will release capital to pay down debt and, where appropriate, invest in its growth agenda.

Premium Cigars has performed well over a number of years with good revenue and profit growth; however, it is a unique luxury business with a different consumer base and route to market relative to Imperial's other businesses. The sale of the business provides an attractive opportunity to realise shareholder value.

The divestment programme was announced in May 2018 and is expected to generate proceeds of up to £2 billion by May 2020, if not earlier. Imperial has so far realised £280 million from the sale of a portfolio of other tobacco products in the USA and a further 9.99 per cent of Logista. ...


From https://www.londonstockexchange.com/exc ... 57716.html

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Re: Imperial Brands (IMB)

#220098

Postby idpickering » May 8th, 2019, 7:07 am


idpickering
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Re: Imperial Brands (IMB)

#220225

Postby idpickering » May 8th, 2019, 5:38 pm

This from TMF penned by Paul Summers;

Yielding almost 9%, this FTSE 100 dividend stock still looks a bargain to me

The return of volatility in the markets over the last couple of days — thanks largely to the ongoing trade dispute between the US and China — should matter little to Foolish investors, particularly those concerned with simply generating an income from their portfolio.

That’s why, today, I’m ignoring whatever President Trump does or does not do and concentrating on the latest set of interim results from tobacco giant and FTSE 100 constituent Imperial Brands (LSE: IMB).

Before markets opened this morning, the £22bn cap was forecast to return a monster 8.7% in 2019 — a yield so large that it would be natural to question whether a cut to the payout is only a matter of time.

Personally, I continue to regard Imperial as something of a top-tier bargain for dividend hunters.


https://www.fool.co.uk/investing/2019/0 ... ain-to-me/

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Re: Imperial Brands (IMB)

#225368

Postby OLTB » May 29th, 2019, 8:58 pm

Evening all

I’ve just noticed this rns from IMB posted this afternoon https://www.investegate.co.uk/imperial- ... 36055207A/ and haven’t noticed similar messages before. Is this IMB management worrying a little and trying to support the share price, or a normal event that I just haven’t noticed before?

There was a Nielsen report earlier this week detailing that tobacco sales were down 11.2% in the US.

Cheers, OLTB.

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Re: Imperial Brands (IMB)

#225383

Postby monabri » May 29th, 2019, 10:30 pm

I noticed the announcement too . I also thought it a bit unusual.

Mr Google reveals this article

https://www.euronews.com/2019/05/29/imp ... -4-percent


So, looks like they're disputing the report...that's my take on it.

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Re: Imperial Brands (IMB)

#225408

Postby Dod101 » May 30th, 2019, 7:00 am

Obviously, Imperial must be worried about the drop in their share price because the consequent increase in the yield consigns it to 'junk stock' and because in the event that they were to look to expand, they would be unable to use so devalued shares in a takeover so any misleading (if it is misleading) stats will be refuted.

Even a 5/6% drop is huge though surely? I will not be adding any more to either of my tobacco shares and will try to reduce my exposure if I can. OTOH the yield is wonderful and the divis keep increasing.............

I wonder if we might see further industry mergers?

Dod

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Re: Imperial Brands (IMB)

#225409

Postby OLTB » May 30th, 2019, 7:09 am

Thanks Dod - it is an eye-watering yield and I am building up my dividends to the point that a top-up might be possible in the next month or so.

I keep asking myself the same impossible question - are tobacco stocks going through a similar negative feeling that the commodity stocks went through a few years ago? Will there be a massive bounce back?

Do I feel lucky, punk?

Cheers, OLTB.

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Re: Imperial Brands (IMB)

#225592

Postby idpickering » May 30th, 2019, 5:51 pm

I'm not buying any more IMB as I have a 'full' holding, but intend to buy more BATS to bring them up to average capital value weighting in my HYP.

Ian.

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Re: Imperial Brands (IMB)

#234770

Postby idpickering » July 8th, 2019, 7:06 am

Imperial Brands Announces Revised Capital Allocation and Shareholder Distributions Policy

· 2019 dividend unchanged at 10% growth

· Revised progressive dividend growth policy thereafter

· Continued investment in growth opportunities

· Divestment programme on track

· Further deleverage to support a strong and efficient balance sheet

· Return surplus cash, including via share buybacks; up to £200m share buyback announced



The Board of Imperial Brands PLC today announces a revised capital allocation and shareholder distributions policy to support continued growth and optimised returns for shareholders. The Board reaffirms the 10% dividend growth in respect of the final dividend for the current financial year ending 30 September 2019. Thereafter, the revised dividend policy will be progressive, growing annually from the current level, taking into account underlying business performance. This new policy recognises the Company's continued strong cash generation and the importance of growing dividends for shareholders, while providing greater flexibility in capital allocation.


https://www.investegate.co.uk/imperial- ... 00057152E/

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Re: Imperial Brands (IMB)

#234773

Postby TheMotorcycleBoy » July 8th, 2019, 7:54 am

idpickering wrote:Imperial Brands Announces Revised Capital Allocation and Shareholder Distributions Policy

https://www.investegate.co.uk/imperial- ... 00057152E/

Thanks for this idp,

I liked the sound of this bit

* Further deleverage to support a strong and efficient balance sheet
(though what parts of the business will they sell?)

But I didn't like this bit much:

* Return surplus cash, including via share buybacks; up to £200m share buyback announced
i.e. isn't the whole point of the surplus cash, as something to use to "deleverage" oneself?

FWIW I have about 3% of our foli in IMB. My personal view is that whether people smoke baccy or e-fags, there will always be something in human nature making people want to do this, so I don't have *massive* concerns about the longevity of such a business. Financial considerations excepted!

Matt

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Re: Imperial Brands (IMB)

#234774

Postby TheMotorcycleBoy » July 8th, 2019, 7:55 am

EDIT:

They do also state:

Further active capital management through our ongoing divestment programme, which remains a key priority. We are on track to realise proceeds of up to £2 billion before May 2020 and will assess the most appropriate use of proceeds at the time including debt reduction and share buybacks.

so let's hope they apply some common sense here!

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Re: Imperial Brands (IMB)

#234777

Postby idpickering » July 8th, 2019, 8:07 am

It seems that this has been well received, with the sp up 1.25% on market opening. This has had almost zero effect on my 22% capital loss on my IMB holdings though. :D I’m not overly concerned, and shall continue to hold, although I’m unlikely to buy more as I have a ‘full’ weighting in my HYP, and I’ve spent enough on their shares already.

Ian.

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Re: Imperial Brands (IMB)

#234793

Postby Dod101 » July 8th, 2019, 9:19 am

This is presumably intended to cheer up their shareholders but I doubt that there is anything very much new in it. If they sell bits of the business that may well help with deleverage but it will also reduce the size of the business hence I suppose the prospect of share buybacks. I am a bit concerned that their 10% growth in the dividend is up to 2019 only but it does mean that we do not need to wait for their results announcement in December or whenever to know that. Thereafter it is to be 'progressive'. That is a lot better than announce a cut and thereafter it will be progressive which seems to be the norm.

Difficult to know the effect on that on the share price because the shares were rising last week anyway. All in all very helpful on a quiet Monday morning.

Dod

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Re: Imperial Brands (IMB)

#234841

Postby Wizard » July 8th, 2019, 11:38 am

I see this more negatively, I think it marks the end of the 10% increase per year. If the policy is revised, that means changed and I can't see the policy changing to an increase of more than 10% per year. So the dividend growth rate is going to be slower. I am not sure if the current share price woes will be refuted by this, as in there was an expectation of a more drastic change / rebasing, or if this will confirm the current negative sentiment.

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Re: Imperial Brands (IMB)

#234843

Postby Itsallaguess » July 8th, 2019, 11:45 am

Wizard wrote:
I see this more negatively, I think it marks the end of the 10% increase per year. If the policy is revised, that means changed and I can't see the policy changing to an increase of more than 10% per year. So the dividend growth rate is going to be slower.


I don't really see how we can read their statement in any other way, other than telegraphing a slow-down in dividend-growth (my bold below) -

The Board reaffirms the 10% dividend growth in respect of the final dividend for the current financial year ending 30 September 2019.

Thereafter, the revised dividend policy will be progressive, growing annually from the current level, taking into account underlying business performance. This new policy recognises the Company's continued strong cash generation and the importance of growing dividends for shareholders, while providing greater flexibility in capital allocation.


Where we might differ is where you take the view that this might be seen as 'negative'...

I've been concerned for some time that a 10% year-on-year dividend increase can't be sustainable over even the medium term, never mind the long term, and so an RNS statement that says they're going to revise that unsustainable dividend progression to a more sustainable level, but whilst crucially still not cutting the dividend, is something I personally see as a positive step for the business, and not a negative one...

Cheers,

Itsallaguess

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Re: Imperial Brands (IMB)

#234847

Postby Wizard » July 8th, 2019, 11:54 am

Itsallaguess wrote:
Wizard wrote:
I see this more negatively, I think it marks the end of the 10% increase per year. If the policy is revised, that means changed and I can't see the policy changing to an increase of more than 10% per year. So the dividend growth rate is going to be slower.


I don't really see how we can read their statement in any other way, other than telegraphing a slow-down in dividend-growth (my bold below) -

The Board reaffirms the 10% dividend growth in respect of the final dividend for the current financial year ending 30 September 2019.

Thereafter, the revised dividend policy will be progressive, growing annually from the current level, taking into account underlying business performance. This new policy recognises the Company's continued strong cash generation and the importance of growing dividends for shareholders, while providing greater flexibility in capital allocation.


Where we might differ is where you take the view that this might be seen as 'negative'...

I've been concerned for some time that a 10% year-on-year dividend increase can't be sustainable over even the medium term, never mind the long term, and so an RNS statement that says they're going to revise that unsustainable dividend progression to a more sustainable level, but whilst crucially still not cutting the dividend, is something I personally see as a positive step for the business, and not a negative one...

Cheers,

Itsallaguess

Indeed, hence my subsequent point that the impact on share price will probably, in part at least, depend on whether the market expected worse, such as a rebasing or freeze in the dividend.

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Re: Imperial Brands (IMB)

#234871

Postby Dod101 » July 8th, 2019, 12:34 pm

I agree that the likely outcome is a possible reduction in the 10% increase in dividend but there are a lot of moving parts. For example, talk of special dividends, and share buybacks. Share buybacks will help to reduce the cost of the overall dividend per share, and specials give them flexibility, although I suspect most of us would prefer a constant dividend (increase) rather than a 'lumpy' special.

The whole announcement seems to me to be telling us that they are finding ways of reducing the debt and of climbing off the bandwagon of a continuous (and probably unsustainable) dividend increase of 10% pa without causing too much anguish amongst shareholders. Meanwhile the SP is up 2.8%.

Dod


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