Cineplex Raises Dividends

Cineplex recently reported its best first quarter adjusted EBITDA (earnings before interest, tax, depreciation and amortization) result in company history. This was partly due to hit films such as The Hunger Games (which I enjoyed quite a bit) and Dr. Seuss' The Lorax.The Hunger Games had highest grossing first quarter weekend of all time and the third largest opening weekends of all time.

The company declared that it will raise the annual dividends from $1.29 to $1.35. This will be the 2nd increase since converting from an income trust to a corporation in 2011. Cineplex has the majority of the Canadian market and operates theatres under the names Cineplex Odeon, Galaxy, Famous Players, Colossus, Coliseum, SilverCity, Cinema City and Scotiabank Theatres.

Canadian Oil Sands Raises Dividends

At the end of April, Canadian Oil Sands Ltd announced that it will hike its dividends 17% from 30 cents to 35 cents. Sale volumes were low compared to the first quarter of 2011 mainly due to maintenance issues. The company also reported lower and lower net income compared to last year's first quarter.

Here's a quote from Marcel Coutu, President and Chief Executive Officer:

The increase in the dividend to $0.35 per share reflects confidence in our business fundamentals and the commitment to delivering excess cash to our investors," said Marcel Coutu, President and Chief Executive Officer. "Continued strength in oil prices and Syncrude's solid operating base generated strong revenues, resulting in a growing cash balance over the first quarter. Combined with our recent US$700 million debt issuance, we have the liquidity to fund our major capital projects over the next few years while maintaining a strong balance sheet and dividend.
 
From the highlights of the report, it seemed to me like the company wasn't having a good  quarter relative to last year. While increasing dividends is usually a boon for shareholders and I enjoy getting a raise when I sat around and did nothing, I'm bothered by the quote.

Canfor's Complicated Structure & Dividend Woe

Oh Canfor, why do you do this to me? Yesterday, the company announced they will be distributing a dividends of 22 cents (compared to 25 cents in the previous quarter). A little background on Canfor will help grasp a better understanding of the situation.

Canfor Pulp Limited Partnership (CPLP) is what owns two pulp mills and one paper & pulp mill. Canfor Pulp Products Inc. (CPPI) use to own 49.8% of CPLP (CPPI is what currently have a position in). Canadian Forest Products Ltd. (CFP) controlled the remaining 50.2%. Under the terms of the Exchange Agreement made back in January 2011 from all parties involved, CFP exercised its right to essentially exchange its 50.2% interest in CPLP for a 50.2% direct interest in CPPI in early March of this year. This resulted in CFP having a controlling interest in CPPI (with the remaining 49.8% of shares being owned by the old shareholders - like me) while CPPI took 100% control of CPLP. Confused yet? I sure was. Basically this is what happened: