Shareholders have done well with us
-Banks DIH
Stabroek News
April 3, 2004
Banks DIH says the numerous bonus shares offered over the years that have enriched investors are not being given due consideration by analysts discussing the company's share price.
The press release comes a couple of weeks after an address to Banks DIH shareholders in New Amsterdam, when Chairman and CEO Clifford Reis questioned his company's shares valuation on the stock exchange.
"I am very concerned about who are the persons involved in trying to manoeuvre the company's shares, Reis said and declared that the price according to the balance sheet was $10.31.
Stock exchange officials, were quick to refute any suggestion of manipulating, issuing a press release a few days later outlining the share's transactions, since trading began.
Banks, while not mentioning again the manoeuvring question, says "while a bonus issue increases the total issued share capital of a company, it also increases the number of shares to each shareholder. Therefore using the most recent 5:4 bonus share issue, a shareholder with 100 shares previously will now receive dividend payments on 125 shares, at no additional cost."
They add that a 100 shares purchased in 1955 when Banks Breweries was first established would now have grown to 19,152, an increase of 19,052 shares, while the total dividend payments on the original investment of $100 would be $37,696.
While not wanting to get into a discussion of the company's share price, Banks notes that since the establishment of the Guyana Association of Securities Companies and Interme-diaries (GASCI) the total number of shares traded in Banks DIH has been 3.4M, representing 0.39% of the total number issued.
"While the principles of market operation are simple enough to understand, the prices that are determined on an exchange with low volumes surely cannot be taken as representative of the true value." The company also refered to an article in Stabroek News of March 25 which expressed views from GASCI on the share value. "We are unsure whether as a securities exchange GASCI should be making such statements. Maybe the Guyana Securities Council could advise on the acceptability of such action. Assuming but not admitting that GASCI could make such a public statement...GASCI ought to be more objective."