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Bausch & Lomb (NYSE:BOL) on Tuesday Nov 7, 2006 declared a regular quarterly dividend of $0.13 per share on the Common stock of the Company. Payable Tuesday, January 2, 2007, to shareholders of record at the close of the business day on Friday, December 1, 2006, the shareholder will be able to collect a dividend, record it for 2007 income and maybe still do any tax loss selling in Dec. All pretty nifty if you ask me.

Bausch and Lomb also released preliminary numbers on Thursday Nov 9, 2006. They were very careful to call them metrics, which is not a legally defined term within the context of securities law. They are not able to properly file a 10Q and provided all manner of caveats as to why investors should not rely on the metrics, preliminary results or whatever that was that the company threw out to the marketplace.

When the board declares a dividend what do they rely on? If the financials are in such disarray that investors cannot rely on them how does the board come to the decision that a dividend may be paid? In this case the dividend was unchanged from the last declaration. That usually means something.

Leadership is ambiguous to non-existent. Management has a mess and is looking for exculpatory cover as they try to dig their way out of the problem. The Board is whistling through the graveyard issuing financial signals, by way of dividend declarations, indicating that they think the situation is OK.

The dividend declaration came out on Tuesday Nov 7, two full business (open for trading) days before the financial metrics were issued. A large trading spike occurred late on Tuesday. The stock has dropped approximately 6% in the past week.

Dividend declarations and financial results reporting should be integrated. Management comments and actions by the board should be congruent when reporting on the financial condition of the company. Please see my previous blog comments about Moody’s (NYSE:MCO) on Wednesday Oct 25 and an open letter to the SEC posted on Monday Oct 30.

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