Monthly Archives: November 2017

Royal Dutch Shell: £200bn of Value: Largest Company of the FTSE-100

Yesterday, Royal Dutch Shell broke the £200bn valuation:

www.shell.com

It is two share listings, Shell A and Shell B

http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?csi=133655

http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?csi=133755

Yesterday:

Shell A was worth: £ 108,862m
Shell B was worth: £ 91,390m

A combined value of £200,252 million = £200.252 Bn.

Shell

The Foreign and Colonial Investment Trust November Dividend.

The Foreign and Colonial Investment Trust is a flagship investment trust listed on the London Stock Exchange.

http://www.fandc.com/foreign-and-colonial-investment-trust/

It dates back to 1868, and allowed small investors to get access to global stock markets.

On Wednesday 1st October it paid out 2.5p per share to shareholders.

http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/FRCL/13412215.html

The total number of voting rights in the Company is 542,582,345

Thus:

542,582,345 x £0.025 = £13,564,558.63

That is a £13m divident payout.

http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?csi=10192&action=

1.6% yield

75,000 Banking Jobs lost due to Brexit.

The Bank of England thinks that 75,000 banking jobs could be lost from The City of London due to the UK leaving The EU.

http://www.bbc.co.uk/news/business-41803604

What could this mean ?

If the average London banker salary is say £80,000 what money will be lost to the UK Treasury in lost income tax ?

So:-

75,000 people x £80,000 = £6,000,000,000 (£6 billion in salaries)

approx 50% of this is paid in Income Tax and National Insurance.
That means immediately a loss of revenue for the UK Treasury of £3,000,000,000

Then the salaries post of tax is used to rent or mortgages or buying food, the cost of living.
All that disposable income is also lost to the UK economy.

75,000 jobs being lost, could mean, £6 Billion lost to the UK economy,

Brexit will result in the UK becoming poorer.

HM Government October Borrowing

Another month, guess what, take a lucky guess, it is the same old story, HM Government, spends more money than it receives via taxes and duties. Another deficit month, thus to bridge the gap, needs to borrow on the bond market.

In October 2017, the HM Government had to borrow money to meet the difference between tax revenues and public sector expenditure. The term for this is The PSNCR: The Public Sector Net Cash Requirement.

There were “only” 4 auctions of Gilts (UK Government Bonds) by the UK Debt Management Office (http://www.dmo.gov.uk/) to raise cash for HM Treasury:-

24-Oct-2017 0 5/8% Index-linked Treasury Gilt 2042 £650.0000  Million
19-Oct-2017 1¼% Treasury Gilt 2027 £2,599.2400 Million
10-Oct-2017 1¾% Treasury Gilt 2037 £2,500.0000 Million
05-Oct-2017 0¾% Treasury Gilt 2023 £3,162.5000 Million

When you add the cash raised:-

∑(£650.0000  Million + £2,599.2400  Million + £2,500.0000 Million + £3,162.5000 Million) =  £8911.74 Million

£8911.74 Million  = £8.91174 Billion

On another way of looking at it, is in the 31 days in October, HM Government borrowed:-

£287 million each day for the 31 days.

We are fortunate, while the global banking and financial markets still has the confidence in HM Government to buy the Gilts (Lend money to the UK), the budget deficit keeps rising. What is also alarming, is the dates these bond mature 2042, 2037, 2027 and 2023. All long term borrowings, we are mortgaging our futures, but at least “We Are In It Together….

Stock Market Valuations: AT&T and Facebook

Stock market prices are in the financial press. Their is a lot of talk about the global stockmarkets being highly over valued. What is interesting is seeing the valuations of some technology companies.

Lets look at American Telephone and Telegraph (AT&T).

http://www.nasdaq.com/symbol/t

Now lets look at Facebook

http://www.nasdaq.com/symbol/fb

The difference is huge.

AT&T’s market value is: $203,049,800,000 ($203 Billion)

Facebook’s market value is $523,481,434,266  ($523 Billion)

Two huge technology companies, one over 100 years old, and the other is less that 15 years old.
Yet Facebook is worth more than twice that of the telephone giant, AT&T.

Morrison’s PLC November Dividend

Morrisons PLC paid out its November dividend.

http://www.morrisons.com

It paid out 1.66p per share, what did this cost Morrisons PLC ?

https://otp.tools.investis.com/clients/uk/morrison/rns/regulatory-story.aspx?cid=623&newsid=946302

The total number of voting rights in Wm Morrison Supermarkets PLC is 2,355,206,626.

Thus:

2,355,206,626 x £0.0166 = £39,096,429.99

That is £39m in cash

http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?csi=10248&action=

That is 2.4% yield.

Facts from the Q3 HSBC Results 2017

Facts from the Q3 HSBC Results 2017

The Hong Kong and Shanghai Banking Corporation released its Q3 results on the 30th October.

http://www.hsbc.com/investor-relations/group-results-and-reporting?pid=HGHQ:EL:IN:XX:HOM:1710:001:3Q2017

The numbers are staggering, in the sense the bank is vast.

Total assets $2,526,214 MILLION, yes $2.526 TRILLION
Loans and advances to customers $945,168, yes $945 Billion
Cutomer accounts deposits $1,337,121, yes $1.337 TRILLION
Debt securities in issue $59,740, yes $59 Billion of bonds

The Standard Life Passive Plus III Pension Fund

The Standard Life Passive Plus III Pension Fund is a fund from Standard Life that is actually a funds of funds.

https://uk.standardlifeinvestments.com/SL_P_Passive_Plus_III.pdf

It is also the default fund that investors (pension savers) with BT, who joined after March 2001, and is given to staff who join the BT Retirement Savings Scheme.

https://www.btretirementsavingscheme.com/bt/

The goal of this fund is to provide long term growth while being managed to a level of risk, rather than a
level of return. The fund is part of the Passive Plus range, which aims to offer five different combinations of
investment risk and return levels

Current Fund Size £2,744.3 Million

SL VANGUARD FTSE UK ALL SHARE INDEX 14.6% of the fund
SL SLI GLOBAL ABSOLUTE RETURN STRATEGIES 13.9% of the fund
SL VANGUARD US EQUITY 13.3% of the fund
SL VANGUARD UK SHORT-TERM INVESTMENT GRADE BOND 10.8% of the fund
SL VANGUARD UK INVESTMENT GRADE BOND INDEX 10.8% of the fund
SL PROPERTY PENSION 6.3% of the fund
SL VANGUARD FTSE DEVELOPED EUROPE EX UK EQUITY INDEX 5.7% of the fund
SL VANGUARD UK GOVERNMENT BOND INDEX 4.9% of the fund
SL VANGUARD JAPAN STOCK INDEX 4.1% of the fund
SL MONEY MARKET PENSION 4.1% of the fund
SL VANGUARD PACIFIC EX JAPAN STOCK INDEX 3.4% of the fund
SL VANGUARD EMERGING MARKETS STOCK INDEX 3.3% of the fund
SL SLI GLOBAL HIGH YIELD BOND 2.8% of the fund
SL GLOBAL PROPERTY SECURITIES ASSET 2.0% of the fund

The performance:

Year to 30/06/2017 (%) 11.0
Year to 30/06/2016 (%) 3.7
Year to 30/06/2015 (%) 5.6
Year to 30/06/2014 (%) 7.2
Year to 30/06/2013 (%) 7.2

You can see year on year growth.