AGM in London this year

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Why? Anyway, I'm going t try to get along. Is anyone else going?

-- Anonymous, November 13, 2000

Answers

Apparently, the rationale is to give the insitutional investors a chance to attend.
My instinct is that significant institutional investors would make the trip to the Toon to attend anyway, and therefore I can only conclude it is to escape the strong verbal criticism they have attracted from supporter shareholders at the past two meetings - when the financial results were infinitely better than this time around.
I have to say I find this a very disappointing action, and I'll have to see if I can make it down to Lahndan to ensure they don''t got off scot-free.
I may contact the Shareholders Trust people to see if they are going to organise a special trip for local shareholders.
The local papers report that shareholders have been invited to two Open Days at SJP this week, as an alternative to attending the AGM(!) - on Nov 14 at 2-5pm, and Nov 15 at 9am-12.
They reckon shareholders have been invited to these Open Days - well, I certainly haven't. Anyone else receive one?

-- Anonymous, November 13, 2000

Haven't received anything about open days, but as a London based shareholder and season ticket holder, I intend going to the AGM. When is it happening? I haven't received anything about that yet either. Should I take this personally, or is the Board just keeping everyone in the dark (so no change there, then)?

-- Anonymous, November 13, 2000

Terry,

The Journal reports that the AGM will be held on December 8.
In answer to your other question, ALL shareholders should receive notification of the AGM - this is normally included with the Annual Report. Given the AGM is scheduled for December 8th, we should be receiving this very soon - there are normally Resolutions to be voted on at the AGM that require the opportunity for shareholders to lodge postal votes ahead of the Meeting.
If I don't make it to the AGM - as seems probable - I'd like someone to ask the Board what the rationale is for a Company reporting such massive financial losses to be making ANY dividend, especially one where the majority simply falls into the pockets of the major shareholders, who also happen to be Executive Directors?
Dividends are the mechanism for distributing retained profits to shareholders that are not required for the development of the business.
The response will probably be that they are offering shareholders a "scrip" dividend, under which the Directors won't take cash out of the business, but take the dividend as additional shares in lieu of cash. This is NOT an acceptable answer:

- firstly, there is NO profit from which to make a dividend
- secondly, the business needs all of its cash reserves (and more) for the development of the business, and
- lastly, Management should NOT be receiving ANY financial reward for presiding over such a disastrous financial performance.

I would urge all shareholders to vote against this bizarre and injudicious dividend payment, which I do not beleive is in the best interests of the business.

-- Anonymous, November 13, 2000


Phew, Clarky

Glad I never had to ask you for me pocket-money.............

-- Anonymous, November 13, 2000


>>>>>- firstly, there is NO profit from which to make a dividend

Clarky you are surely aware that many companies continue to pay dividends even when making losses in order to keep shareholders happy. It would be imprudent to do so if the company had cash flow problems, and/or was in danger of folding. To my knowledge such problems do not exist and turnover is set to rise due to stadium expansion.

>>>>>- secondly, the business needs all of its cash reserves (and more) for the development of the business, and

Jeez. The guys take a scrip issue last year to keep the cash in the club and you criticised that too.

>>>>- lastly, Management should NOT be receiving ANY financial reward for presiding over such a disastrous financial performance.

In our deliberations on the bbs over the results, no-one was too clear just how disastrous these results were, and no-one could successfully reckon how we had "lost" 19m on "player trading". The management is NOT rewarded excessively and the dynamic duo earn less salary as board members than many contributors here. IF they pay divis to shareholders then we shareholders get the same divi. IF they chose to take scrip those of us who want can take the cash OR shares as we see fit.

I think a much more serious point is why they are holding the meeting in the place whose continued expansion damages our homeland. The institutionals should come to us not vice versa, although as I currently reside in Cambridge (for reasons which are unlikely to become clearer) I should manage to attend myself.

-- Anonymous, November 13, 2000



Jonno,

Management of companies who continue paying dividends when the company is losing money are usually fools. In this instance two directors own 60% of the company, so they're certainly keeping the majority shareholders happy by paying a dividend.

Whatever the underlying factors, the simple reality is that the Company made a massive operating loss in the last reporting period, does not have large cash reserves, has experienced a trend of declining revenues in most facets of its business, and is massively in debt. I don't believe it is terminal, but I'm certainly not particularly sanguine over this situation.

We all hope and expect things to improve, and I'm sure an expression of confidence to the City was part of the rationale for adopting such a ballsy dividend strategy. This, plus the fact that I believe they have elected to take as many negatives as possible into the last accounts, to the likely benefit of the current period. I happen to believe the proposed dividend policy is potentially dangerous, unecessary and imprudent given the volatility of the situation the Club has found itself in.

As a small shareholder myself, I would far prefer and applaud a more prudent approach to cash management, and deplore the fact that by pocketing ca.60% of the declared dividend - cash or shares - management is effectively rewarding itself for producing a dreadful set of annual financial results.

I certainly don't recall criticising the Directors for taking a scrip dividend last year. Indeed I favour this cash-conservative approach - but only when paying a dividend is prudent and appropriate.

BTW, in taking a scrip dividend the Directors are not electing to be philanthropic - they effectively dilute all other shareholders by taking newly-issued shares in lieu of cash, which can be sold on whenever they wish.

The reason for having the AGM in London will be partly to attract institutional coverage, and partly to avoid the kind of bun-feast they would inevitably experience in the Civic Centre when presenting these awful financial results, and being unable to satisfactorily explain the underlying 'issues' to the everyday punters.

-- Anonymous, November 13, 2000


I'm not sure it's neccesarily a cynical move. They are having two open days, know the stakes they are playing for with the fans and maybe just need to be away from the bunfight at such a delicate time for our finances. Additionally, I would imagine that the small few organisations to whom we owe big money are based in London.

-- Anonymous, November 13, 2000

Can I just add that we play Arsenal at Highbury the next day...

-- Anonymous, November 13, 2000

To be honest Dougal, I think they may well be making the correct decision.
The last two AGM's have been little better than slagging matches with supporter/shareholders, at which the Director's performance - or lack of performance to be more accurate - has left a lot to be desired.
Freddie Fletcher has borne the brunt of the flack during these meetings, and perhaps Messrs. Fender & Stonehouse feel it should be conducted differently, with more dignity, and rather more professionally.

-- Anonymous, November 14, 2000

Sort of related, but i saw the exact same thing happen with Thomson Holidays in recent months. They did exactly what NUFC are doing.

About two months later they were taken over by a German Tour Operator. Management got extra share options in the divy pay-out to ensure 'extra effort'. The shareholders were offered their original buying price. Result: Management win cashing in said share options, despite gross incompetence. Shareholders get nowt.

cynical? moi?

-- Anonymous, November 14, 2000



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