Friday, 1 July 2016

Bolt-on Purchase - Empire Company

On June 29, I took the opportunity to increase my holdings in EMP.A. Quarterly results were not great and the stock price was down 11%. The integration of their Safeway Canada aquisition is proving very difficult which is the reason for their poor financial results.  A day prior to my purchase, the company announced a 2.5% dividend increase.

EMPIRE COMPANY LIMITED (TSX: EMP.A)  is a Canadian company headquartered in Stellarton, Nova Scotia. Our key businesses are food retailing and related real estate, through wholly-owned subsidiary Sobeys Inc., and a 41.5% equity accounted interest in Crombie REIT. With $24.6 billion in annualized sales and $9.1 billion in assets, Empire and its subsidiaries, franchisees and affiliates employ approximately 125,000 people.

EMP.A (I averaged down):

Number of shares purchased
100
Price per share
$19.20
Commission
$9.95
Total cost per share
$19.30
Total cost
$1,929.95
Annual dividend per share
$0.41
Initial dividend yield
2.12%
Increase in forward 12-month dividends
$41.00

My initial purchase of EMP.A was on March 14, 2016: 145 shares @ $22.27.

With this purchase, my 12-month forward dividend income is $11,139.

Tidbit

On August 9, 2009, I bought 495 shares of EMP.A @ $13.73.  The dividend yield was 1.8%.
I sold these shares on July 9, 2014 @ $23.73 because of low dividend yield + low dividend growth.





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