RE:RE:RE:Totally AgreeHi guys,
I completely understand your scepticism with respect to this company and its representatives, which is based on a horrible capital allocation history.
But one thing that simply doesn't fit in this picture is the elimination of the dividend and its timing at the release of 3rd quarter results. At this time they must have known an indication of a possible sales price for the Hamilton property, the fact that 27 million of receivables (outstanding tax credits in current assets) will be converted to cash in the first half of 2020 and the cash balance of more than 50 million. Besides that, it was before the fourth quarter, the strongest of the year and presumably a cash flow positive one. Why on earth did they eliminate the dividend of 10 cents annually, which has been paid since 2016, at this point of time? Thereby activating the mechanism which could give voting power to all shareholders after 8 quarters. Through the elimination of the dividend Torstar saves only 8 million in cash annually, compare this to the cash situation including tax credit receivables, Hamilton sale proceeds, and cash on the balance sheet.
This simply makes no sense from a timing and rational perspective. Or is there perhaps something different behind that? Do they want to exert pressure on some of the families - through the elimination of the dividend - for a potential going private deal in concert with Fairfax? A going private deal with Fairfax was discussed at the end of 2016, but some of the families didn't want to agree (Source: Globe & Mail).
Let's hope for a change and something significant! I'm with Mediawatcher: I strongly believe the elimination of the dividend has been the best news for years, even if this sound completely crazy and the stock halved through that once again!
All the best,
Don