Page 24 - CIMA SCS Workbook February 2019 - Day 2 Tasks

CIMA FEBRUARY 2019 – STRATEGIC CASE STUDY

Reference Materials – Email to Paul Pau from Chris Heloise

Email

To: Paul Pau
From: Chris Heloise, Goya Co
Subject: Dividend concerns

Hello Paul.

Thank you for sending me a copy of the Vita annual report.

I’m afraid to say that I was disappointed to read in the “Notes to the accounts” that Vita has “no
plans to pay any dividends at present.” When Goya Co invested in Vita when it was first listed in
2017, we understood that the company had never paid dividends in the past because of the need
to reinvest heavily in new technologies. However, two years on from the listing, and as the
consumer electronics industry continues to grow, we were hoping that you would be able to start
rewarding your shareholders by paying dividends soon.

Even if Vita doesn’t want to commit to paying a dividend every year, I think a one-off strategy
such as a scrip dividend or a share repurchase would be appreciated by shareholders. Such a
strategy would help to send a positive signal about the state of the company and its willingness to
reward its shareholders.

Could we please meet up later in the week to discuss these issues? Perhaps on Friday at 11.00 at
your office?

40 KAPLAN PUBLISHING