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Ray_Rich
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Independent investor specializing in deep value plays.... often called contrarian in my views. My goal with every stock i purchase is to double my money. If a companies stock does not offer the opportunity to at least double in the next 24 months I am looking for a better opportunity. I try to... More
  • AT / ATP - Open Letter To Management 3 comments
    Nov 9, 2013 10:46 AM | about stocks: AT

    Disclosure: I have purchased ATP (ticker is AT in USA) in July 2013

    Dear Management,

    This letter is to address my and other shareholder complaints regarding your current policy and recent statements regarding your dividend.

    Here is my problem, I understand the original div cut. Atlantic Power was leaking money all over the place, but here we are not leaking money, sure they have some debt coming up due. But looks to me like we are paying down debt currently and when it comes due we should be able to refinance this debt.

    Management needs to understand that the reason most have this stock is the fact that the dividend is there. For me I bought it as a dividend and turnaround play a few months ago.

    This company has a ton of assets, and they do have a lot of debt but that being said they should be able to continue with a dividend and pay down the debt. When you say that you are eliminating the dividend out of a utility the stock is going to crash down, did the management team not learn anything last time?

    There is absolutely no way they should be in management positions if they do not understand most investors are here for the yield.

    Only good news I can see if you eliminate the dividend is that the price will fall down lower 3's which I guarantee will bring about either a buyout or a activist investor which will at least get back some shareholder value.

    I feel sorry for the longer term owners here, as currently management is just blowing this thing out of the water. I have been a shareholder since about June/July and at that point I believed the strategy was to pay down debt, keep the div alive at 3c for about a year or year and a half and then start to inch it back up. This was going to work!

    When management outlines a plan they need to follow through.

    Please listen to the words here and also the words of Mr. Market and decide to stick with your plan.

    Best Regards,

    Ray Rich

    Disclosure: I am long AT.

    Themes: Dividend, Atlantic Power, Utilities Stocks: AT
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Comments (3)
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  • Envoy Global Research
    , contributor
    Comments (336) | Send Message
     
    I agree with you. Management comments make little sense. They claim that they can meet debt maturities in 2014 with refinancing and cash, both of which would not effect the dividend. However, then they mysteriously decide that it maybe better to take a more "comprehensive" approach to their capital structure, which if implemented "could have an adverse impact on the dividend level". But if they have an option to address near term debt without a dividend cut, why are they considering options that will adversely impact the dividend? Doesn't pass the smell test.
    9 Nov 2013, 07:51 PM Reply Like
  • Ray_Rich
    , contributor
    Comments (44) | Send Message
     
    Author’s reply » Completely agree with you. I feel like they have to stick to the plan and continue without lowering or removing the dividend.
    9 Nov 2013, 10:26 PM Reply Like
  • as6df
    , contributor
    Comments (5) | Send Message
     
    look at yellow media and the recent reorganisation of the capital structure. Had they stopped paying those hefty dividends earlier - they could have avoided a very messy recapitalisation.
    10 Nov 2013, 09:02 PM Reply Like
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