Bossini International Holdings Ltd.

0592.HK – Bossini International Holdings Ltd.

Bossini maintained a consistent dividend policy over the past 15 years. In enhancing shareholders’ value, it is striking to achieve a continuous double-digit growth in both turnover and profit levels and the board recommended a consistent dividend policy of at least 30% payout ratio per annum (Saxena & Khandelwal, 2010). From the graph in part a, we can see that the dividend per share was quite consistent and smoothing in spite of the fluctuation in EPS, so it is inferred that Bossini is acting in accordance to their claimed dividend policy.

Organization culture

From part a, we notice a significant decrease in EPS and a correspondingly decrease in theoretical dividend predicted by Linter Model but without noticeable change in actual dividend paid.  

In 2002, Bossini tried to expand its network of operation, but the economy deterioration in Hong Kong impelled many apparel operators to cut prices and reduce inventory. As a result, Bossini incurred an operating loss of HK$66 million (Morris & Staritz, 2014), which indirectly caused the closing down of 13 outlets in 2003. Thus, the decreasing in EPS is of no surprise.

However, According to Chan, Choi, & Man (2016), Bossini initiated “7 habits” organizational culture in 2002, which triggered the transformation of Bossini into a learning organization that attaches much importance to knowledge communication and life-long learning. To achieve the transformation, all the staff had to take part in targeted training, from directors to frontline shop assistants (Corbellini & Saviolo, 2014). Since Bossini embraced its mission of becoming the industry leader and focused more on enhancing efficiency and staff aptitude, it was confident about its market expansion and profitability (Andreotti & Moreno-Fuentes, 2014). So it appears reasonable that Bossini did not cut dividend in 2002.  

0008.HK – PCCW Limited

Stable and sustainable dividend policy has been emphasized by PCCW, but it is always seeking for international growth in media businesses.

Event effect

From part a, we notice a significant increase in actual dividend paid but without noticeable change in EPS.

On April 22, 2009, the HK Court of Appeal agreed the appeal of SFC in respect of the privatization of PCCW and vetoed the privatization. On the following day, the large shareholders announced that the privatization would expire automatically after the term and announced a special dividend of $1.3 (Cheng, 2012).