George Weston Limited (WN)

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Taggart
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George Weston Limited (WN)

Post by Taggart »

I'm copying this from PI's post in the dividend hikes section.
Peculiar_Investor wrote:This one is special, George Weston Limited Announces $1 Billion Special Dividend
George Weston wrote:George Weston Limited ("Weston") (TSX: WN) announced today that it will pay a special one-time common share dividend of $1 billion, representing $7.74751 per common share, on January 25, 2011 to all common shareholders of record at the close of business on January 18, 2011.

"The Corporation's track record of solid operating performance, combined with significant cash balances and ample liquidity to grow the business, provides the Corporation with the opportunity to reward shareholders with a return in excess of our normal dividend," said W. Galen Weston, Chairman and President of the Corporation.

Mr. Weston added: "Capital markets have come through some very turbulent times and the Corporation took a conservative position holding excess cash. Now with increased stability in the capital markets and our strong balance sheet, the directors felt that a return of capital was appropriate. At the same time, we are preserving sufficient financial flexibility to meet the Corporation's ongoing operational and capital requirements and to pursue growth opportunities."
Wow! They think money is better in their shareholders hands rather than their own. Of course, it probably doesn't hurt that the Weston family has a large ownership stake so are paying themselves. Perhaps the Shaw family could have followed this example?
I highlighted the part above that has me puzzled. Since when does a Total Debt to Equity Ratio of 89.56 constitute a strong balance sheet? Wouldn't it have been better if they'd just increased the annual dividend payments a little bit, and used the rest of the cash to pay down debt? Even the company's current ratio of 1.8 wouldn't of passed Ben Graham's minimum of 2 to 1.
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Re: George Weston Limited (WN)

Post by FinEcon »

Not that I am looking to buy WN but it does indicate a strong balance sheet given the industry the firm participates in. IMHO, you have to adapt Graham's rules a fair bit for between industry comparison of securities or ranking against any arbitrary absolute number like the 2:1, which is sort of the same thing an an abstract sense (i.e. you're effectively creating a dummy industry against which all others are compared).

If the ratio itself is not to your liking, consider the cost of debt to the firm or revenue stability against margin stability. Don't get me wrong, you, I and Norm are probably the biggest Graham-ites on this board but I think now so many people know the basic Graham criteria that you have to add some flavour to it. Just my 2 cents.
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DanH
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Re: George Weston Limited (WN)

Post by DanH »

Taggart wrote:I highlighted the part above that has me puzzled. Since when does a Total Debt to Equity Ratio of 89.56 constitute a strong balance sheet? Wouldn't it have been better if they'd just increased the annual dividend payments a little bit, and used the rest of the cash to pay down debt? Even the company's current ratio of 1.8 wouldn't of passed Ben Graham's minimum of 2 to 1.
I'm not familiar with how Reuters presents info so is that supposed to be a percentage or a raw number? Also, recall that a debt to equity ratio of 1:1 is equal to a debt to asset ratio of 0.5:1.

In any case, the Reuters data don't line up with Weston's third quarter report for that stat. The latest report shows a D/E ratio of 1.9x and a D/A ratio of 0.65x.

DISCLOSURE: I own Weston currently but bought it many months ago below $60.
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Re: George Weston Limited (WN)

Post by Taggart »

Two of Westons competitors, both Empire and Metro have far stronger balance sheets at around 40% debt to total equity.

Note: I own both competitors and am not doing a selling job.
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Re: George Weston Limited (WN)

Post by Peculiar_Investor »

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Re: George Weston Limited (WN)

Post by Peculiar_Investor »

For those who might be investing in or watching this stock, George Weston Limited announces the sale of its Weston Foods Fresh and Frozen Businesses
George Weston press release wrote:TORONTO, Oct. 26, 2021 /CNW/ - George Weston Limited ("George Weston" or the "Company") (TSX: WN) today announced that it has signed a definitive agreement to sell its Weston Foods fresh and frozen bakery businesses to affiliated entities of FGF Brands Inc. ("FGF") for aggregate cash consideration of $1.2 billion. The purchase price represents approximately a 10.0x multiple on the 2021 estimated EBITDA of the Weston Foods fresh and frozen bakery businesses. The fresh and frozen bakery businesses comprised approximately 75% of Weston Foods' 2020 net sales. George Weston continues to be committed to selling its remaining ambient business – comprised of cookies, cones, crackers and wafers, and is actively engaged in that process.
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Re: George Weston Limited (WN)

Post by snowback96 »

George Weston press release wrote:TORONTO, Oct. 26, 2021 /CNW/ - George Weston Limited ("George Weston" or the "Company") (TSX: WN) today announced that it has signed a definitive agreement to sell its Weston Foods fresh and frozen bakery businesses to affiliated entities of FGF Brands Inc. ("FGF") for aggregate cash consideration of $1.2 billion.
I hope FGF Brands got lots of PC Optimum points!!! :lol:
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Re: George Weston Limited (WN)

Post by Peculiar_Investor »

More of the business has been sold so they "will be focused on its market-leading Retail and Real Estate businesses going forward", George Weston Limited announces the sale of its Weston Foods Ambient Business.
George Weston press release wrote:George Weston Limited ("George Weston" or the "Company") (TSX: WN) today announced that it has signed a definitive agreement to sell the Weston Foods ambient bakery business to affiliated entities of Hearthside Food Solutions, LLC ("Hearthside") for aggregate cash consideration of CAD$370,000,000.

"With the agreement to sell the ambient segment to Hearthside and our previously announced sale of the fresh and frozen businesses, we have two high-quality buyers that are well-positioned to carry on the proud legacy of the Weston Foods business," said Galen G. Weston, Chairman and CEO of George Weston. "With the sale of the entire bakery business, George Weston will be focused on its market-leading Retail and Real Estate businesses going forward."
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Re: George Weston Limited (WN)

Post by Bylo Selhi »

Loblaw names new president and CEO, replacing Galen Weston in top job
Loblaw has named Danish retail executive Per Bank to be its president and CEO starting next year, replacing Galen Weston in the top job at the company... Bank is currently CEO of Danish retail chain Salling Group A/S, which runs more than 1,700 supermarkets across three countries in Europe...

While he will no longer be president of Loblaw, Weston will remain chair of the company's board, as well as CEO of Loblaw's parent company, George Weston Ltd. Loblaw says Weston "will play an active role setting the strategy for the group" in his role as chair of the company.
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