Directors at British American Tobacco (LSE: BATS) (NYSE: BTI.US), Reckitt Benckiser (LSE: RB) and Goals Soccer Centres (LSE: GOAL) splashed out this Christmas — on buying shares in their own companies.
At what price were these directors happy to treat themselves, and how much did they invest? Read on!
Goals Soccer Centres
Goals Soccer Centres, a £127m AIM-listed company, is the UK’s leading five-a-side football chain with 44 sites around the country.
Philip Burks, who co-founded self-storage firm Big Yellow Group, joined Goals as a non-executive director at the start of 2011. Up until recently, Burks had made relatively small annual purchases of Goals shares. However, in the last few months he’s massively upped his buying. A £240,000 investment on 22 December was the culmination of four separate purchases, totalling almost £0.7m.
Burks’s average buy price was 218p, but you’ll have to pay a bit more than that today. The shares currently trade at 235p — or 14 times 2015 forecast earnings.
Reckitt Benckiser
Another director who bought himself a £0.7m present of company shares was Reckitt Benckiser’s chief financial officer, Adrian Hennah. Hennah, who was poached from medical devices firm Smith & Nephew two years ago, bought 13,222 Reckitt shares at 5,177p a pop, doubling his previous holding at one fell swoop.
The share price is at around the same level today and represents a hefty 20 times Reckitt’s 2015 forecast earnings. However, you’ll miss out on a benefit Hennah and other shareholders at the time enjoyed. The CFO bought his shares before Reckitt demerged its pharmaceuticals business on 23 December, and, as such, automatically received shares in the new company, Indivior, currently worth 149p. Effectively, then, an investor today would need to buy Reckitt shares at 5,028p (5,177p minus 149p) to match Hennah’s deal.
British American Tobacco
British American Tobacco chairman Richard Burrows rounded off 2014 with a New Year’s Eve purchase of 5,000 company shares at 3,520p a time. The £176,000 investment took his total holding to 15,000 shares.
Burrows, a former chief executive of Pernod Ricard, who joined British American Tobacco in 2009, was happy to pay 16 times BAT’s 2015 forecast earnings and bag a dividend yield of 4.5%. You can pick the shares up slightly cheaper today at 3,460p.