Why Tanah Emas And Chin Well Should Never Had Proposed Its Dividends In The First Place!

Blogged the other day: More On The Flip-Flops Of Proposed Dividends.

Instead of relying on what's posted on our local news media, Divided over dividend payout, let's look at what was posted on Bursa Malaysia itself.

Here is Tanah Emas on 22nd December 2008: TANAMAS - REASONS FOR THE REJECTION OF THE PAYMENT OF FIRST AND FINAL DIVIDEND

• Further to Listing's Circular No.L/Q : 52128 of 2008, the Board of Directors of TECB had announced that the major shareholders, who are also the Directors of the Company have rejected the recommendation on the payment of First and Final Single Tier Dividend of 5 sen per share for the financial year ended 30 June 2008 to the shareholders.
  
  This is due to:
  a) the recent economic downturn and drastic drop in Crude Palm Oil price; and
  b) the Company needs to conserve cash for its operations and business expansion opportunities.
  
  As such, the previous announcements dated 27 November 2008 and 1 December 2008 pertaining to the dates of dividend entitlement and book closure are no longer applicable.

This was Tanah Emas announcement on the 27th November: First and Final Dividend

It even had an ex-date announced for the payment of the dividends!!

Yup I kid you not!

Did it state anywhere in that announcement that the dividends needs approval from shareholders? Now this would be rather misleading for a less than average investor, yes?

The dividends were proposed on August 28th. PROPOSED FIRST AND FINAL SINGLE TIER DIVIDEND OF RM0.05 PER SHARE FOR THE YEAR ENDED 30 JUNE 2008

This was TanahEmas quarterly earnings announced on the same date. Quarterly rpt on consolidated results for the financial period ended 30/6/2008

This was how much Tanah Emas has in its piggy bank.

16.317 million was all it had in its piggy bank.

A 5 sen per share dividend would amount to RM10.998 million!

Not a whole lot left after paying this dividend yes?

And this is how much Tanah Emas has in its borrowings.

And as stated in the earlier posting, More On The Flip-Flops Of Proposed Dividends.

• Yes, can't they THINK before shooting their mouths off that they are going to reward their shareholders with dividends?
  
  Is it so difficult to THINK?
  
  Was it hard to see back in August that the world is in an economic crisis? Was it hard to see that the dividends SHOULD NEVER HAVE BEEN PROPOSED in the first place?

Here is Chin Well's announcement on Christmas Eve: CHINWEL - REJECTION OF THE PAYMENT OF A FIRST AND FINAL TAX EXEMPT DIVIDEND

Note also that Chin Well too had announced when the dividends would go-ex: First and Final Dividend

And like Tanah Emas, the dividend was mooted and mentioned back in August too: Quarterly rpt on consolidated results for the financial period ended 30/6/2008

And like Tanah Emas, Chin Well's cash balances were rather low and saddled with high debts!

A cash balance of only 11.9 million versus total net borrowings of 175.3 million showed clearly that Chin Well's balance sheet wasn't in the best of financial health.

And yes, I am baffled why Chin Well chose to make that dividend announcement back in August 2008!

Let's see a dividend of 6 sen would equate to 8.175 million.

Surely Chin Well should not have proposed such a dividend payout!

And again I repeat what I posted the other day: More On The Flip-Flops Of Proposed Dividends.

• Yes, can't they THINK before shooting their mouths off that they are going to reward their shareholders with dividends?
  
  Is it so difficult to THINK?
  
  Was it hard to see back in August that the world is in an economic crisis? Was it hard to see that the dividends SHOULD NEVER HAVE BEEN PROPOSED in the first place?

The fact that they did announced their dividends and the fact that they are now flip-flopping on its dividends shows exactly how unprofessional they are!

Rather embarrassing event for corporate Malaysia!