{"id":18832,"date":"2017-03-16T15:32:29","date_gmt":"2017-03-16T19:32:29","guid":{"rendered":"http:\/\/ianchadwick.com\/blog\/?p=18832"},"modified":"2024-04-24T15:52:02","modified_gmt":"2024-04-24T19:52:02","slug":"dividends-for-dummies","status":"publish","type":"post","link":"https:\/\/ianchadwick.com\/blog\/dividends-for-dummies\/","title":{"rendered":"Dividends for dummies"},"content":{"rendered":"
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\"Dividends\"A dividend, as defined by the Business Dictionary<\/a>, is “A share of the after-tax profit of a company, distributed to its shareholders…”<\/strong> This is reiterated in the description from the Oxford Dictionary<\/a>: “A sum of money paid regularly (typically annually) by a company to its shareholders out of its profits (or reserves).”<\/p>\n

So in order to pay a dividend, you need to make a profit<\/em>. Otherwise, all your revenue goes to operating expenses, salaries and taxes. And a dividend isn’t paid to just one person or shareholder: if one shareholder gets one, then every shareholder gets one. Dividends are NOT automatic, are NOT paycheques.<\/p>\n

Now say you were a shareholder, and you stripped the revenue stream away from a company you own shares in, and in doing so,\u00a0you reduced its profit to zero, and say you also caused it greater expenses – say by forcing it to pay more for legal advice or transportation and accommodations for out-of-town shareholders – would you still expect a dividend?<\/p>\n

Common sense tells us no. No profit: no dividend.*<\/span> But common sense is an uncommon attribute at our council table.<\/p>\n

On March 13’s agenda<\/a>, there was a letter from Collus-PowerStream saying the board had decided not to pay a dividend for 2015, and would decide about 2016 after it examined the company’s audited financial statements. (on the Rogers TV broadcast<\/a>, it starts at 0:18:13, just after the lengthy, self-serving “community” announcements… go past Councillor “Sleepy” Ecclestone’s painful “moved by myself” grammatical error to 0:22:22).<\/p>\n

This, of course, sent The Block into a tizzy. At 0:22:37 Sleepy again does another “moved by myself” gaffe to introduce a motion to request “an explanation of why the board has chose (sic) not to declare a dividend…” and to “express our concern and disappointment.”<\/p>\n

Okay, dear readers, if you have followed this story you already know that:<\/p>\n