Sharechat Logo

Diligent says no dividend this year, mulls US listing

Tuesday 25th June 2013

Text too small?

Diligent Board Member Services, whose strong operational performance has been undermined by a slew of administrative errors, won't pay a dividend this year, preferring to reinvest funds back into the business, and has set up a group to review listing options.

Chairman David Liptak told shareholders at today's annual meeting in Auckland the board has decided to "retain current and future earnings to support operations and finance future growth" and "does not intend to pay a dividend in 2013," according to presentation slides published on the NZX.

The company has been building a growing pile of cash, adding US$3.1 million in the first three months of the year to its US$33.3 million in cash and equivalents as at Dec. 31. That increasing cash position has fuelled speculation Diligent is ripe for a takeover offer, and put pressure on the company to make a return to shareholders.

Liptak said the board will review its capital management policy at the end of the year.

Diligent is also weighing up its listing options, setting up a capital markets working group made up of Liptak and fellow directors Mark Weldon and Greg Peterson. The group will work with chief executive Alex Sodi, general counsel Tom Tartaro and chief financial officer Carl Blandino to weigh up the costs and benefits of various options.

Because the company is subject to US public company law "we expect any listing in the US would not create any material additional regulatory burden, cost or complexity," Liptak said. "All options will be considered, including dual listing, secondary listings, and the various markets available within both the US and New Zealand."

Liptak reaffirmed Diligent's commitment to review its corporate governance, announced last week when it mistakenly recognised revenue early. That was the latest administrative error, which included assigning too many options to its executives and appointing auditors who didn't comply with New Zealand regulation.

The shares fell 0.3 percent to $6.93 today, paring its 27 percent gain this year.

BusinessDesk.co.nz



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Diligent censured, fined for numerous listing rules breaches
Diligent misses filing date for first-half earnings, shares drop to 9-month low
Diligent to restate revenue from past three years, says US sales slow in 2Q
NZX queries Diligent price fall since announcing revenue recognition problems
Diligent makes mistake recognising revenue in accounts before it should have
Diligent CEO Sodi may get extra US$6.7 mln in tax-efficient bonus scheme
Diligent sees growing importance in European sales
Diligent boosts 1Q sales 84 percent amid strong growth outside US
Diligent directors come up with new CEO incentive scheme
Diligent to put new director, auditor to shareholders at June annual meeting