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Notice

JB Hi-Fi Limited (ASX Code: JBH) Special Dividend – Adjustment Implications for JBH Exchange Traded Options (ETOs)

What's this about:

Notice reference number: 0955.24.08

Date published: 21/08/24

Effective as of: 22/08/24

Last updated: 21/08/24

JB Hi-Fi Limited $0.80 Special Dividend – Adjustment implications for ETOs

ASX Notice No. 0933.24.08 dated 14 August 2024 outlined the adjustment method for JB Hi-Fi Limited (ASX Code: JBH) ETOs due to the announcement of a $0.80 special dividend and an ordinary dividend of $1.03, both dividends will have an ex-dividend date of Thursday, 22 August 2024.

Effective Date

The effective date of this adjustment is Thursday, 22 August 2024.

ASX determined that the last cum-dividend VWAP based on trading on ASX markets on Wednesday, 21 August 2024 was $77.1623

Standard Method of Adjustment

Theoretical New Contract Size = Old Contract Size + (total special dividend paid per Old Contract Size)/(S – OD – SD)

Theoretical New Contract Size = 100 + ($0.80*100)/($77.1623-$1.03-$0.80)

= 101.062 rounded to 100 where the difference of 1.062 will be cash adjusted based on the below formula.

Strike Factor = Old Contract Size/Theoretical New Contract Size

Strike Factor = 100/101.062

= 0.989492

Please note that this is a non-rights style adjustment.

Cash Equalisation Adjustment Payments for Contract Size Roundings

The cash adjustment is calculated by taking the difference between the contract value of the option before and after the adjustment. Variants to the formula apply for rights style adjustments and when the adjustment occurs on the day of the option’s expiry.

Cash adjustment = (BOP * BUV) – (AOP * AUV)

Where

BUV =Before (adjustment) Unit Value = BP * BU rounded to nearest cent

AUV =After (adjustment) Unit Value = AP * AU rounded to nearest cent

BU = units per lot (multiplier) before the adjustment (old traded entity)

AU = units per lot (multiplier) after the adjustment (old traded entity)

BP = for rights style, =SP/Adjustment Factor, for non-rights style=SP.

AP = for rights style, =SP, for non-rights style=SP * Adjustment Factor.

SP = settlement price of the option if not the options expiry day, otherwise the intrinsic price (underlying price-strike price for calls, strike-underlying price for puts) if on expiry date. Refer Notes 1 and 2 below

BOP =pre-adjusted open position Refer Notes 1 and 3 below

AOP =post-adjusted open position Refer Notes 1 and 3 below

Note:

Cash adjustments on expiry will apply to exercised positions only.
The intrinsic price used for exercised positions on expiry is based on the adjusted strike price for rights style adjustments and the pre-adjusted strike price for non-rights style adjustments. Set negative intrinsic prices to zero i.e. if an out of the money is exercised, the intrinsic price and hence cash adjustment is zero.
Pre and post adjusted positions will be the same unless there is a position adjustment factor applied to the open position associated with the adjustment. For rights style use the start of day position (i.e. exclude any UA trading activity), for non-rights style use the (end-of-day) position prior to the adjustment.
Cash adjustments will also apply to LEPO positions.
For short positions, the result of the cash adjustment formula should have its sign reversed (multiply by -1). For non-LEPO positions the truncation approach ensures that the seller (writer) is always debited and the buyer (taker) is credited. Because the LEPO strike is usually returned to 1c after the adjustment, the holder of a short LEPO position may be credited and long position may be debited.

Refer to table below for adjusted strike and contract size

Old Size	New Size	Old Strike (Cents)	New Strike (Cents)	Exercise
100	100	1	1	E
100	100	4050	4007	A
100	100	4100	4057	A
100	100	4150	4106	A
100	100	4200	4156	A
100	100	4250	4205	A
100	100	4251	4206	E
100	100	4300	4255	A
100	100	4301	4256	E
100	100	4350	4304	A
100	100	4351	4305	E
100	100	4400	4354	A
100	100	4401	4355	E
100	100	4450	4403	A
100	100	4451	4404	E
100	100	4500	4453	A
100	100	4501	4454	E
100	100	4550	4502	A
100	100	4551	4503	E
100	100	4600	4552	A
100	100	4601	4553	E
100	100	4650	4601	A
100	100	4651	4602	E
100	100	4700	4651	A
100	100	4701	4652	E
100	100	4750	4700	A
100	100	4751	4701	E
100	100	4800	4750	A
100	100	4801	4751	E
100	100	4850	4799	A
100	100	4851	4800	E
100	100	4900	4849	A
100	100	4901	4850	E
100	100	4950	4898	A
100	100	4951	4899	E
100	100	5000	4947	A
100	100	5001	4948	E
100	100	5100	5046	A
100	100	5101	5047	E
100	100	5200	5145	A
100	100	5201	5146	E
100	100	5300	5244	A
100	100	5301	5245	E
100	100	5400	5343	A
100	100	5401	5344	E
100	100	5500	5442	A
100	100	5501	5443	E
100	100	5600	5541	A
100	100	5601	5542	E
100	100	5700	5640	A
100	100	5701	5641	E
100	100	5800	5739	A
100	100	5801	5740	E
100	100	5900	5838	A
100	100	5901	5839	E
100	100	6000	5937	A
100	100	6001	5938	E
100	100	6100	6036	A
100	100	6101	6037	E
100	100	6200	6135	A
100	100	6201	6136	E
100	100	6300	6234	A
100	100	6301	6235	E
100	100	6400	6333	A
100	100	6401	6334	E
100	100	6500	6432	A
100	100	6501	6433	E
100	100	6600	6531	A
100	100	6601	6532	E
100	100	6700	6630	A
100	100	6701	6631	E
100	100	6800	6729	A
100	100	6801	6730	E
100	100	6900	6827	A
100	100	6901	6828	E
100	100	7000	6926	A
100	100	7001	6927	E
100	100	7100	7025	A
100	100	7101	7026	E
100	100	7200	7124	A
100	100	7201	7125	E
100	100	7300	7223	A
100	100	7301	7224	E
100	100	7400	7322	A
100	100	7401	7323	E
100	100	7500	7421	A
100	100	7501	7422	E
100	100	7600	7520	A
100	100	7601	7521	E
100	100	7700	7619	A
100	100	7701	7620	E
100	100	7800	7718	A
100	100	7801	7719	E
100	100	7900	7817	A
100	100	7901	7818	E
100	100	8000	7916	A
100	100	8001	7917	E
100	100	8100	8015	A
100	100	8101	8016	E
100	100	8200	8114	A
100	100	8300	8213	A
100	100	8400	8312	A
100	100	8500	8411	A

Need more information?

Issued by

Greg Fitzpatrick, Senior Manager Clearing Operations

Contact information

Clearing Operations
clearing@asx.com.au