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Centum pays out KSH 1 billion to employees
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mlennyma
#21 Posted : Wednesday, September 16, 2015 12:57:37 PM
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At this rate the employees will become very rich,leave the company and start their own business ventures
"Don't let the fear of losing be greater than the excitement of winning."
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Othelo
#22 Posted : Wednesday, September 16, 2015 1:01:44 PM
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Joined: 1/20/2014
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mlennyma wrote:
At this rate the employees will become very rich,leave the company and start their own business ventures

Cytonn comes to mind!!!
Formal education will make you a living. Self-education will make you a fortune - Jim Rohn.
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ngapat
#23 Posted : Wednesday, September 16, 2015 3:19:31 PM
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Joined: 12/11/2006
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C&P wrote:
This does not sound good. The company has frozen dividends yet it is paying employees a sum that can pay a dividend of kshs 1.5 per share to all shareholders.
There are other ways of rewarding employees like Employee share ownership programs (ESOP) rather that those extra ordinary cash sums.

Some of the profits comes from fair value gains on disposal of assets which does not reflect employees hard work and such gains should be excluded when rewarding them.

They should also set a limit to the amount that can be paid other wise there will be cooking of books to maximise the bonuses. A billion is too much
“Invest in yourself. Your career is the engine of your wealth.”
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streetwise
#24 Posted : Wednesday, September 16, 2015 4:39:10 PM
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Precisely, the employee are earning more than the shareholders over any amount of time for investing only their time.

Let’s recheck this in the future but I smell a rat
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alotoftalk
#25 Posted : Wednesday, September 16, 2015 4:46:24 PM
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In principal I am 100% in agreement with this mode of compensation. It keeps the employees on their toes.

What I don't agree with is the payment in cash. This is not an investment bank, hedge/VC/PE fund where the employees are partners rather the capital they are employing belongs to the shareholders not the employees.Should anything go wrong the employees and management will have their cash and the shareholder all the downside.

Why should they be paid in cash while shareholders are asked to wait for capital gains or sell a portion in case they need cash dividend equivalent?

They should be paid in shares vesting over 3-5 years. This way their interests will be truly aligned with those of the shareholders.

On the bright side the CEO is a key shareholder;truly aligned with the rest of the shareholders.
Investment philosophy development in progress...
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heri
#26 Posted : Wednesday, September 16, 2015 5:04:26 PM
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Joined: 9/14/2011
Posts: 857
Location: nairobi
alotoftalk wrote:
In principal I am 100% in agreement with this mode of compensation. It keeps the employees on their toes.

What I don't agree with is the payment in cash. This is not an investment bank, hedge/VC/PE fund where the employees are partners rather the capital they are employing belongs to the shareholders not the employees.Should anything go wrong the employees and management will have their cash and the shareholder all the downside.

Why should they be paid in cash while shareholders are asked to wait for capital gains or sell a portion in case they need cash dividend equivalent?

They should be paid in shares vesting over 3-5 years. This way their interests will be truly aligned with those of the shareholders.

On the bright side the CEO is a key shareholder;truly aligned with the rest of the shareholders.


Yeah bright side but only to some extent. With the kind of bonuses he is getting +salary per month+ time value of money benefit, do you think even if the share price does not do so well, he will lose as much?

In any case, 3-5 years down the road if he smells disaster, he will be the first one to offload with the benefit of insider info

The shareholder here can easily get screwed

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ngapat
#27 Posted : Wednesday, September 16, 2015 5:13:15 PM
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Its clear that a company that pays small or no dividends tends to be avoided by investors and hence the share price remains depressed (kplc,kenya-re).
So Kirubi and co could be fleezing dividend payments to end interests for the shares from investors and keep the share price depressed.

They then reward themselves with cash bonuses which they use to buy the depressed shares.
In the end they will end up with the whole company with out spending a dime.

So all the dividends share holders are sacrificing will end up with the old DJ.
I'll be selling shares of amount equivalent to what i invested tomorrow.
“Invest in yourself. Your career is the engine of your wealth.”
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alotoftalk
#28 Posted : Wednesday, September 16, 2015 5:56:31 PM
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Joined: 8/27/2015
Posts: 138
Location: Harare
heri wrote:
alotoftalk wrote:
In principal I am 100% in agreement with this mode of compensation. It keeps the employees on their toes.

What I don't agree with is the payment in cash. This is not an investment bank, hedge/VC/PE fund where the employees are partners rather the capital they are employing belongs to the shareholders not the employees.Should anything go wrong the employees and management will have their cash and the shareholder all the downside.

Why should they be paid in cash while shareholders are asked to wait for capital gains or sell a portion in case they need cash dividend equivalent?

They should be paid in shares vesting over 3-5 years. This way their interests will be truly aligned with those of the shareholders.

On the bright side the CEO is a key shareholder;truly aligned with the rest of the shareholders.


Yeah bright side but only to some extent. With the kind of bonuses he is getting +salary per month+ time value of money benefit, do you think even if the share price does not do so well, he will lose as much?

In any case, 3-5 years down the road if he smells disaster, he will be the first one to offload with the benefit of insider info

The shareholder here can easily get screwed



He's KES 200MM skin in the game. A decline of 10% hits him with KES 20MM. That will screw him unless he's a billionaire plus.

Though if I go as per @ngapat's theory the cash bonuses will soon make him one of the top owners while other shareholders wait for their capital gains or losses.

Investment philosophy development in progress...
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dunkang
#29 Posted : Wednesday, September 16, 2015 6:03:21 PM
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Does this company belong to the employees or the shareholders.

That board needs to be thoroughly investigated. Or the employees are their mistresses and family members.
Receive with simplicity everything that happens to you.” ― Rashi

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target1360
#30 Posted : Wednesday, September 16, 2015 6:14:55 PM
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i didnt think that i d see another uchumi this openly.

this news will. cause massive exists of shareholders depressing the shares which the big boys will take up.if wanjikus dont sell then they l keep getting shafted.either way the big boys win.
I find satisfaction in owning great business,not trading them
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target1360
#31 Posted : Wednesday, September 16, 2015 6:32:40 PM
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Posts: 289
Location: nairobi
alotoftalk wrote:
heri wrote:
alotoftalk wrote:
In principal I am 100% in agreement with this mode of compensation. It keeps the employees on their toes.

What I don't agree with is the payment in cash. This is not an investment bank, hedge/VC/PE fund where the employees are partners rather the capital they are employing belongs to the shareholders not the employees.Should anything go wrong the employees and management will have their cash and the shareholder all the downside.

Why should they be paid in cash while shareholders are asked to wait for capital gains or sell a portion in case they need cash dividend equivalent?

They should be paid in shares vesting over 3-5 years. This way their interests will be truly aligned with those of the shareholders.

On the bright side the CEO is a key shareholder;truly aligned with the rest of the shareholders.


Yeah bright side but only to some extent. With the kind of bonuses he is getting +salary per month+ time value of money benefit, do you think even if the share price does not do so well, he will lose as much?

In any case, 3-5 years down the road if he smells disaster, he will be the first one to offload with the benefit of insider info

The shareholder here can easily get screwed



He's KES 200MM skin in the game. A decline of 10% hits him with KES 20MM. That will screw him unless he's a billionaire plus.

Though if I go as per @ngapat's theory the cash bonuses will soon make him one of the top owners while other shareholders wait for their capital gains or losses.



how sure are we that the guy being m.d has nt recieved over 300m this year in bonusses. calculated from cooked valuations.
why not publish the allocation of the billion among employees?
I find satisfaction in owning great business,not trading them
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heri
#32 Posted : Wednesday, September 16, 2015 6:33:13 PM
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who has the current shareholding?
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target1360
#33 Posted : Wednesday, September 16, 2015 6:39:29 PM
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*
I find satisfaction in owning great business,not trading them
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MaichBlack
#34 Posted : Wednesday, September 16, 2015 6:42:25 PM
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Joined: 7/22/2009
Posts: 7,570
dunkang wrote:
Does this company belong to the employees or the shareholders.

That board needs to be thoroughly investigated. Or the employees are their mistresses and family members.

Definitely!!! Of the 90 employees, probably only 30 are "independent". 60 are definitely family, friends, mistresses etc.

They are "legally" giving money that belongs to the company to their relatives and friends. Hii ni wizi ya hali ya juu sana.

And the targets are too low!! Increase shareholders wealth by 25%. Kwani they were supposed to increase by how much in any case. Then they take a whooping 20% of the "surplus"???? And most of this - like increase in value of land and property - is not because of their effort!!! This is a pure shylock arrangement!!!!

Hapa the shareholders are being shafted proper!!! The executives get an equivalent of 3 million per month in addition to their hefty salaries and allowances!!?? And the kawaida employees are getting 11.1 million bonus in one year!? How many investors will get 11.1 million ONCE courtesy of this stock???
Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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ngapat
#35 Posted : Wednesday, September 16, 2015 6:51:15 PM
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What happens if the NAV declines by 20%? Do they pay a fine to the company? This is a scam

Makes me sick when i imagine that this is my biggest single investments
“Invest in yourself. Your career is the engine of your wealth.”
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mv_ufanisi
#36 Posted : Wednesday, September 16, 2015 6:59:11 PM
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Posts: 625
HUGE red flag. Company for management not shareholders.
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Aguytrying
#37 Posted : Wednesday, September 16, 2015 7:08:24 PM
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It doesn't get clearer than this!
No dividend and high turnover of investments is why i've never invested here.

These bonuses of 1bn confirms it!What does the shareholder ever get? If the company was so serious about retaining cash for investment, why is this cash for bonuses not being invested??

There are companies with highly motivated staff and doing well, there are much, much cheaper ways of motivating employees and among the best is ESOP.
If it looks likes a scam, smells like a scam, feels like a scam, then it is a SCAM.

The investor's chief problem - and even his worst enemy - is likely to be himself
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Lolest!
#38 Posted : Wednesday, September 16, 2015 7:31:27 PM
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Joined: 3/18/2011
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ngapat wrote:
What happens if the NAV declines by 20%? Do they pay a fine to the company? This is a scam

Makes me sick when i imagine that this is my biggest single investments

I read that tey take forward the losses until a positive is realised
Laughing out loudly smile Applause d'oh! Sad Drool Liar Shame on you Pray
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watesh
#39 Posted : Wednesday, September 16, 2015 7:42:30 PM
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Now Uchumi is starting to look more attractive than centum lol....Employees are making more money than shareholders. If they get cash, shareholders should also get a cash return. If those are the bonuses what about other unnecessary expenses and allowances
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MaichBlack
#40 Posted : Wednesday, September 16, 2015 7:57:56 PM
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Joined: 7/22/2009
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watesh wrote:
Now Uchumi is starting to look more attractive than centum lol....Employees are making more money than shareholders. If they get cash, shareholders should also get a cash return. If those are the bonuses what about other unnecessary expenses and allowances

Am telling you!!! Am sure the kind of random allowances the executives get - per diem etc. - would send shock waves through the spines of the shareholders.

This is pure thuggery!!!
Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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