maiden dividend announced !, page-20

Hi.

These thoughts are only guesses if that!

Also, I love my 15 cent f/f dividend. Please don't misunderstand that I don't from what you're about to read.

From what I heard on the grapevine a few months ago. Management prior to the last quarterly results were thinking of a dividend somewhere around 10 cents -- which is why I kept on saying 10 cents about two months ago. The fact that the dividend has come in at 15 cents fully franked has made me think.

Firstly there's no doubt that 15 cents has set a precedent for future dividends. Sure the next dividend may well be lower if the spot price doesn't pick up but that said, this dividend was announced during the worst period of the falling spot price. Surely management where fully aware of the potential loss of future profits when this dividend was announced.

It would seem obvious to me that management would prefer to maintain the 15 cent dividend as a floor price. No company wants to see the dividend slip, it's obviously not a good look, just ask GRR who's just halved their dividend.

Telstra pays two 14 cent f/f dividends a year. When the market thought Telstra would have difficulties maintain a 14 cent dividend, the share price came under pressure. The price dropped to around $2.50. Once Telstra was able to confirm that it was able to maintain the 14 cent dividend, the SP headed north and has kept on heading north.

Anyway, if the grapevine is true, that is, 10 cents was on the cards. Why the 50% increase? The most obvious thing would have been that the last quarter results were much better than expected and thus, the dividend was adjusted accordingly. But I reckon management had a pretty good idea of what they expected prior to the announced results. As well as that, it wasn't just a small increase on the rumored 10 cent dividend. But a 50% increase, that's a big increase on prior projections.

I have another thought. I believe that Regent Pacific may own 40% of BCI in retail and institutional shares. The only way Regent can make money off their BCI investment apart from a gain in the SP and then a subsequent share sale -- is if Regent Pacific pressured BCI management into upping the dividend from 10 to 15 cents. Or atleast Regent tried to talk BCI management into placing more money into dividends and less into M&As and/or exploration.

Another thought, if this hunch is partly correct. Has Regent given up on the idea of trying to take BCI? Are Regent now happy to be a long term holder? ... Or until Palmary Enterprises lowers what it wants for their share in BCI. My rough estimate on the average price paid by Regent for their BCI shares is $1.70. IF BCI can return 30 cents back to shareholders in the form of two divies per year. That's not a bad return for Regent. Infact, it's almost an 18% return on their investment. I wouldn't be selling.