Thank you for your impressive analysis - probably the best I've...

Thank you for your impressive analysis - probably the best I've seen on this forum. There is only one (minor) point which I must correct: you say that IMF should not pay a dividend as they would earn a good return on retaining the profit and should not have a DRP. This would be true in a classical tax system where company profits are taxed in the hands of the company and on receipt by their shareholders (such as existing in the US, UK and most places in the world where finance text books come from) but is not true in Australia with an imputation system. The payment of franked dividends distributes franking credits to domestic shareholders which entitle them to a tax credit. By receiving a franked dividend and fully participating in a DRP, most domestic shareholders are better off (or no worse off) because of the tax credit received but they and the company are in the same position as if the profits had been retained and reinvested in the business. There is no economic dilution because full DRP participation results in you owning the same percentage of the business. Dilution occurs only when someone else is given a share of your cake without paying the full cost. There is accounting dilution when measured on a per share basis but this is purely an accounting fiction which is best illustrated by showing how the position can be restored by a hypothetical share consolidation: cum dividend, you own 100 shares with an EPS of $0.10, after the DRP you have 102 shares with an EPS of say $0.09804. On a per share analysis you have EPS dilution, but if there was then a 100 for 102 share consolidation then you again hold 100 shares with an EPS of $0.10. WES actually did such a share consolidation after their capital return a few years ago. In conclusion, IMF should be congratulated for looking after shareholders on an after-tax basis by paying out profits and having a DRP in place