Kas Bank out, more Aegon in

Today I sold all 100 Kas Bank shares (EPA:KA) I have, because of their results over the first half year and their outlook.

H1 summary of Kas Bank results:

  • Net result H1 -40% from €8.5M to €5.1M
  • Operating income H1 -3,4% from €53.6M to €51.8M
  • Average Assets under Administration -9,0% from €490B to €446B
  • Interim Dividend -36,4% from €0.33 to €0.21

Last year I often did increase my position in companies based on bad knews. I increased for example my position in Macquarie Infrastructure Company in February of this year and I also increased my position in Wereldhave in the same month.

This time I decided to close my position. In the case of Macquarie Infrastructure Company (MIC) and Wereldhave (EPA:WHA) in my opinion their outlook was still healthy despite some bad news which was announced. In the case of Kas Bank I have the idea that their underlying business won’t recover anywhere soon.

Mainly the decline in assets under administration with -9.0% bothers me. In 2017 the assets under administration were also down with -3%. Kas Bank is mainly active as provider of custodian and fund administration services to institutional investors and financial institutions. This means that Kas Bank main source of income is the fee they get for asset and transaction servicing. If assets under administration are down it means Kas Bank (EPA:KA) get less fee’s for safeguarding a firm’s or individual’s financial assets.

Kas Bank writes in their H1 press release that fierce competition resulted in loss of clients.

If a company announced bad news I tend to look at the cashflow and try to understand how the bad news will inflence the long term cashflow. In the case of Wereldhave and Macquarie Infrastructure Company it’s my (personal) opinion that the long term cashflow outlook is the same. For this reason I bought more shares. In the case of Kas Bank I think the long term cashflow is impacted structurally, because lower assets under administration means less fee income and if Kas Bank will be able to increase their assets under administration it’s probably because of reduced fee’s. In a market with ‘fierce competition’ I don’t expect they will be able to attract new customers against above average prices.

It’s maybe even a realistic scenario that Kas Bank has to reduce their fee’s to retain current clients at contract expiry.

For these reasons I decided to sell my Kas Bank (EPA:KA) shares. I purchased 100 shares of Kas Bank in October 2017 at a price of €9,96 and sold them today at €8,00. I received a dividend of €0,31 this year so the closing of this position can really be called taking a loss.

With the funds available from the Kas Bank sale I bought 150 shares Aegon (EPA:AGN) at a price of €5,24. I decided to buy Aegon, because I considerred, until today, Kas Bank as a steady fund in my portfolio with a stable dividend income, but without the expectation for huge share price increases. Aegon I also see as a steady defensive fund with a steady and relatively high dividend income.

With the purchase of 150 shares Aegon (EPA:AGN) I add €36,00 to my estimated yearly dividend income. The sale of 100 shares Kas Bank is reducing my estimated dividend income with €64,00.

This swap in my portfolio brings realising my 2018 dividend income further away, because Kas Bank has a dividend scheduled this year and Aegon also has 1 dividend payment left his year, but is already ex-dividend. Nevertheless it’s my opinion that this time I should sell on the bad news instead of ‘sitting out the storm’.

August Dividend Report 2018

Monthly Report August:

August was an unexpectingly strong month for me with a dividend income of €310,93. My dividend income of August 2017 was €76,53 so my dividend income is up 306%. I’m very happy with this result.

The dividend income is much higher than I expected due to the dividend payment of Flow Traders of €67,50. Flow Traders is a market maker and it did benefit a lot of the volatility in the market in Q1. This resulted in a big profit and a big dividend. Volatility is gone so I expect this was a one time extra high dividend.

Due to this high dividend payment of Flow Traders it’s now possible I will reach the dividend income target of €2.200 I did set for this year. Based on the stocks I own and the dividend payments they have scheduled for the rest of the year I’m now expecting an dividend income this year of €2.193. I just need a few more dividend increases combined with possible dividend income from stock purchases I will make this year and I’m at the target. Still not sure I will reach the target, but at least it’s going to be very very close.

In August I recieved dividend payments of 13 companies. Mainly responsible for the dividend growth are new positions in Flow Traders and Omega Healthcare and also increased positions in National Grid, AbbVie, Macquarie Infrastructure Company and Simon Property Group.

This month I bought 25 shares of Unilever at a price of €48,89 including fee’s. Unilever was already on my watchlist for a long time to buy on a dip, but the share price was mainly moving in a small range. I decided to buy this month defensive consumer goods company and I decided Unilever is my choice for this month.

I ended the month with a portfolio value of €61.378. My estimated dividend income for 2018 based on my current portfolio is €2.193. The yearly estimated dividend income of my current portfolio is €2.386.

Dividend Income – €310,93:

– Flow Traders €67,50
– National Grid €37,54
– Macquarie Infrastructure Company €36,84
– Omega Healthcare €30,89
– AbbVie €29,55
– Simon Property Group €27,59
– Amsterdam Commodities(epa:acomo) €18,00
– Royal Bank of Canada €13,03
– Novo Nordisk €12,06
– ING €12,00
– DSM €10,01
– EPR Properties €9,50
– Apple €6,42

Transactions:
Purchase 25 shares Unilever @ €48,89

Dividend Changes:
Royal Bank of Canada quarterly dividend +4,3% (C$2,52 extra yearly dividend)

2018 Target Status:
I’m at €14.450 out of €18.000 deposit target (80,3%)
I’m at €1.563,79 out of €2.200 dividend received target (71,1%)
I’m at €5.400 out of €5.000 extra mortgage repayments (target reached)

Purchase 25 shares Unilever

Today I bought 25 shares Unilever (EPA:UNA) at a price of €48,89 including transaction fee’s. I already owned 20 shares Unilever so with this new purchase I now own in total 45 shares Unilever. Unilever is currently paying a €0,3875 per share per quarter. This is a yearly dividend of €1,55. The current dividend yield of Unilever (EPA:UNA) is 3,17%. My average purchase price is increasing by this purchase from €40,92 to €45,90

with this purchase I add €38,75 to my yearly estimated dividend income.

I decided to buy more shares of Unilever (EPA:UNA) to add a steady defensive consumer goods company to my portfolio.

I have 4 transactions Unilver on record:

1st purchase: 20 shares @ €38,59
2nd sell: -10 shares @ €44,89
3rd purchase: 10 shares @ €43,25
4th purchase: 25 shares @ €48,89

Unilever N.V. operates in the fast-moving consumer goods industry worldwide. The company operates through Personal Care, Home Care, Foods, and Refreshment segments. The Personal Care segment offers skincare and haircare products, deodorants, and oral care products. This segment markets its products under the Axe, Dove, Lux, Rexona, Sunsilk, TRESemmé, Signal, Lifebuoy, Vaseline, Dermalogica, Murad, Dollar Shave Club, Zest & Camay, and Seventh Generation brands. The Home Care segment provides home care products, such as powders, liquids and capsules, soap bars, and various cleaning products under the Dirt is Good, Surf, Comfort, Domestos, Sunlight, Cif, Pureit, Blueair, and Radiant brands. The Foods segment provides soups, bouillons, sauces, snacks, mayonnaise, salad dressings, margarines, and spreads under the Knorr, Hellmann’s, Bango, Maizena, Robertsons, and Kissan brands. The Refreshment segment offers ice cream and tea-based beverages under the Heartbrand, Magnum, Lipton, Brooke Bond, Ben & Jerry’s, Pure Leaf, Taj Mahal, Grom, Talenti, and Breyers brands.

Royal Bank of Canada increases quarterly dividend with 4,3%

Today Royal Bank of Canada (RY) announced to increase their quarterly dividend from C$0,94 to C$0,98. This is a dividend increase of 4,3%. This is the 2nd time this year that Royal Bank of Canada increased their dividend. Earlier this year Royal Bank of Canada (RY) already increased it’s dividend from C$0,91 to C$0,94.

The total dividend increase this year comes at 7,7%.

This dividend increase of 4 cents results for me in €2,22 extra dividend income per year, because I own 21 shares at the moment.

The yield on cost for me after the dividend increase is 3,85% up from 3,69%

Dividend Changes 2018 up to today

I realized that I don’t have an idea how much my dividend income this year increased due to dividend changes from companies in which I own shares.

I always adjust the dividend in my google docs file after I learn about a dividend increase or decrease, but I don’t have a total overview.

I did make the comparison based on the following rules to keep things simple:

– Only stocks are included which where in my portfolio at the end of 2017 which I now still own.

– Stocks I bought in 2018 and had a dividend increase since opening the position this year are excluded.

– I calculate the extra dividend income based on the number of shares I owned at the end of 2017.

– I use the dividend date I have in my google docs file, no double checks

– I use the following exchange rates to translate to EUR:

EUR/USD 1,15
EUR/GBP 0,90
EUR/CAD 0,66

Dividend increases:

1) Abbvie – +50,0% – €16,70 dividend per year extra
2) Aena – +69,7% – €16,02 dividend per year extra
3) Novo Nordisk – +34,4% – €8,53 dividend per year extra
4) DSM – +39,3% – €8,45 dividend per year extra
5) Think AEX EFT – +15,9% – €6,50 dividend per year extra
6) Simon Property Group – +8,1% – €4,17 dividend per year extra
7) Apple – +15,8% – €3,48 dividend per year extra
8) Bank of America – +25,0% – €3,44 dividend per year extra
9) Coresite Realty – +14,4% – €3,17 dividend per year extra
10) Unilever – +22,9% – €2,89 dividend per year extra
11) Royal Dutch Shell – +2,7% – €2,84 dividend per year extra
12) Aegon – +7,7% – €2,40 dividend per year extra
13) Royal Bank of Canada – +7,7% – €1,85 dividend per year extra
14) Omega Healthcare – +1,5% – €1,84 dividend per year extra
15) WDP – +5,9% – €1,50 dividend per year extra
16) National Grid – +3,0% – €1,49 dividend per year extra
17) l’Oreal – +14,5% – €1,35 dividend per year extra
18) ASML – +16,7% – €1,20 dividend per year extra
19) Coca Cola – +5,4% – €1,04 dividend per year extra
20) Johnson&Johnson – +7,1% – €0,83 dividend per year extra
21) Macquarie Infrastructure Company – 29,6% – -€10,23 dividend per year less
22) Wereldhave – -18,2% – €11,20 dividend per year extra less

Macquarie Infrastructure Company (MIC) and Wereldhave were the only 2 companies in my portfolio reducing their dividend. In both cases I decided increasing the number of stocks I own after a stock price correction as a result of the communication of the dividend cut.

MIC reduced dividend to internally fund the repurposing of a Tank Terminal after a client cancelled a contract. I considerred the selloff to big and decided and increased the number of shares MIC in 2018 from 7 to 42. Currently the yield is 8,7%.

Wereldhave is did decide to cut the quarterly dividend from €0,77 to €0,63. I decided to increase the number of stocks I own from 20 to 55. I bought Wereldhave shares, because I considerred this stock undervalued. Wereldhave has issues with a shopping mall owned in Finland which results in negative valuation adjustments. After the stock correction due to the communication of the dividend cut I decided that I feel that the underlying assumptions I had when starting my position are not changed and bought more shares. Yield is now 7,9%.

In total the dividend changes above are good for €68,36. When setting my target for this year of €2200 income I calculated with €76,80 in extra dividend due to dividend increases. This is 6% of the estimated yearly dividend income at the end of 2017. I’m around this number if I also take into account that some stocks I bought in the first part of 2018 also increased their dividend.

Starting 2019 I will track dividend changes in detail so I have more information available about the development of my dividend income, but for now I’m happy with 22 companies increasing their dividend. I have 6 stocks which normally tend to announce a dividend increase in the last quarter of the year so I’m looking forward to more dividend increases this year.

Interim dividend Flow Traders up 350%

This week Flow Traders (EPA:FLOW) did go ex-dividend. The interim dividend is up from €0,30 to €1,35 this year. This is increasing my estimated yearly dividend income with €52,50.

Flow Traders (EPA:FLOW) is a market maker mainly active in ETF’s. As a result of the high volatility in the market in Q1 the net profit increased a lot and due to the increased profit the dividend was increased. The Q1 net profit was up 705%. The volatility decreased a lot in Q2 and this results in less trading income. The half year net profit is up 386% from previous year.

I don’t consider Flow Traders a dividend growth stock, because it’s results are very dependent on the volatility in the market.

Yield on cost is 5,24%, but with current volatility I don’t expect this to increase. A decrease in dividend for next year is more likely. I bought this stock initially with the assumption to benefit from high volatility in Q2 also, but with the current relatively calm markets I have to reconsider if it’s worth holding Flow Traders (EPA:FLOW), but at the same time it’s hard to decide if it’s a easy sell, because I of course can’t predict when volatility is comming back.

DSM interim dividend up 32,7%

Last week I received an interim dividend of Dutch specialty chemicals company DSM (EPA:DSM). The interim dividend is up 32,7% from €0,58 to €0,77. Also DSM communicated to the plan to payout €2,30 over 2018 including the interim dividend. This is up 24,3% compared to the 2017 dividend.

I own 13 shares of DSM (EPA:DSM). So the interim dividend increase results in €2,47 in extra dividends. Increase of the final dividend will result in €3,38 extra dividend.

Expected Yield on cost will increase from 2,84% to 3,53%.

July Dividend Report 2018

Monthly Report July:

This month I received €98,24 in dividends compared to €63,65 last year. This is an increase of 54,3%! versus the July 2017 dividend received.

6 Companies paid me dividend this month. The grow of dividend income is mainly due to an increased position in Wereldhave and Coresite Realty. Also Coca Cola is a new position adding to the growth of my dividend income.

This month I did buy 23 shares Danone. I added Danone to my portfolio, because I wanted to add some defensive consumer goods companies to my portfolio from the eurozone. Also a few days later a doubled my position in Facebook from 8 to 16 shares. The Facebook share purchase is an opportunistic purchase for me. The share price dropped 20% after the publication of the 2nd quarter results.

The 2nd quarter numbers weren’t bad, but Facebook mentioned lower gross margin expectations for the near future. I still believe in the strong cashflow generating abilities of Facebook so I added a few more shares.

I ended the month with a portfolio value of €58.797.

Dividend Income – €98,24:

– Wereldhave €34,65
– Macquarie Group €20,25
– Coresite Realty €17,64
– Coca Cola €13,06
– EPR Properties €9,25
– Brown-Forman B €3,38

Transactions:
Purchase 23 shares Danone @ €65,65
Purchase 8 shares Facebook @ $176,40

Dividend Changes:
Bank of Americe quarterly dividend +25% ($5,16 extra yearly dividend)
Simon Property Group quarterly dividend +2,6% ($3,20 extra yearly dividend)

2018 Target Status:
I’m at €12.650 out of €18.000 deposit target (70,2%)
I’m at €1.252,86 out of €2.200 dividend received target (56,9%)
I’m at €5.400 out of €5.000 extra mortgage repayments (target reached)

Dividend Simon Property Group up 2,6%

Today Simon Property Group (SPG)announced an increase of their quarterly dividend from €1,95 to €2,00. This is an dividend increase of 2,6% versus the previous dividend and an 11,1% year-over-year dividend increase.

I have 16 Simon Property Group (SPG) shares so this dividend increase will result in an increase of my yearly estimated dividend income of $3,20.

After this dividend increase the yield on cost for me is 4,87%.

Camarillo Premium Outlets – One of Simon Properties assets

Dividend Bank of America +25%

bac

Bank of America announced a 25% dividend increase. The quarterly dividend is increased from $0,12 to $0,15. This means the yearly dividend per share is up from $0,48 to $0,60.

I own 43 shares of Bank of America. So this dividend increase will increase my yearly expected dividend income with $5,16. Yield on cost will increase from 1,84% to 2,30%.

Last year Bank of America already increased their dividend with 60% so the yield on cost is improving a lot for Bank of America.