Share Investor: Long Term View: Sky Network Television Ltd

In this series of posts I am going to be looking at stocks listed on the NZX in relation to their returns to shareholders over the life of their listing -what shareholders would now see in their back pockets if they had invested in the company IPO.

The calculation of returns includes dividends and tax credits.

Sky Network Television Ltd [SKT.NZ] has been good to its shareholders in terms of returns since its IPO in November 1997 (see 1997 IPO prospectus) at $2.20 and its subsequent listing in December of that year and even better for its owner Craig Heatly when founded in 1990. The company structure was reorganized in 2005 (see 2005 Prospectus) and relisted at that stage under the present name. 2006 was the first year it began paying a dividend. For the purposes of this column the return to shareholders will be calculated from the 1997 IPO. 54c in net dividends (see chart above - only available from 2005) paid and tax credits at an average of 30% plus a cash payment of NZ$1.28 per share as part of the 2005 restructure, gives SKT a slightly more than 215% return (see chart below for the share price percentage gain against the average of all NZX indexes) over the 13 year listing (for shareholders in the original SKT listed in 1997), an approximate annual net return just over 16%.

This is approximately a 30% better return when compared to the average of all NZX indexes.