Despite the pandemic, shareholders set to rake it in

August 22, 2020 - 08:33

Despite the difficulties inflicted by the COVID-19 pandemic, several companies plan to pay dividends at surprisingly high rates.


The entrance of West Coach Station, operated by West Coach Station Joint Stock Company (WCS), in HCM City's Bình Chánh District’s An Phú Tây Commune. WCS plans to pay 2019 dividend at a surprisingly high rate of 516 per cent. — Photo

HÀ NỘI — Despite the difficulties inflicted by the COVID-19 pandemic, several companies plan to pay dividends at surprisingly high rates.

Sabeco Sông Tiền Trading & Service JSC (SST) has recently announced it will pay a 2019 dividend in cash at an astonishing rate of 347.6 per cent, meaning every shareholder will receive VNĐ34,760 (US$1.5) for each share they have.

The payout date is scheduled for September 15.

With 4 million shares outstanding, the company plans to spend about VNĐ139 billion to pay the dividend. Previously, in 2018, the company paid cash dividends at a huge rate of 207 per cent.

SST was established in 2006 and the company mainly produces and trades beer, wine and soft drinks.

The company has not announced its financial statements for the quarters of 2020. In 2019, its beer output reached 269 million litres. Net revenue hit VNĐ5.08 trillion and post-tax profit was VNĐ147 billion, up by 21 per cent and 61 per cent, respectively, compared to 2018. Earnings per share in 2019 stayed significantly high at VNĐ34,937.

At the 2020 annual general meeting of shareholders, SST announced a plan to pay a 2020 dividend at a rate of 194.6 per cent. It forecast a post-tax profit decrease of 42 per cent to VNĐ85 billion.

Another brewer Saigon Beer Western JSC (WSB) has also announced it will pay a 2019 dividend at a relatively high rate of 50 per cent instead of the initially planned rate of 40 per cent.

Due to the severe impacts of the COVID-19 pandemic and strict new penalties for drink drivers, most brewers have suffered sharp drops in sales consumption.

Beer firms saw consumption fall by 40-50 per cent in the first two months of this year, while restaurants and catering services lost 70-80 per cent of customers compared to the same period in 2019, according to the Việt Nam Beer Alcohol Beverage Association (VBA).

The VBA said Decree 100, which took effect on January 1, slapped heavy sanctions on inebriated drivers, leading to plunging sales of booze.

The industry has suffered again since the beginning of 2020 as the spread of COVID-19 forces companies to announce layoffs and stores selling non-essential products are requested to shutter.

But according to the brewers, the capital for dividend payment was sourced from their undistributed profit earnings in 2019.

West Coach Station Joint Stock Company (WCS) also surprised shareholders after announcing a plan to spend VNĐ129 billion to pay 2019 dividend at a rate of 516 per cent.

Every shareholder will receive VNĐ51,600 for each share they have.

In 2018, the company paid a dividend at a high rate of 400 per cent, meaning each shareholder received VNĐ40,000 for every share they owned.

The company, listed on the Hà Nội Stock Exchange, earned VNĐ157 billion in revenue and VNĐ86 billion in pre-tax profit in 2019.

It forecast revenue and post-tax profit down 17 per cent and 22 per cent this year, respectively, compared to the previous year, reaching VNĐ130 billion and VNĐ54 billion.

WCS leaders said the COVID-19 pandemic had caused a sharp drop in their earnings in the first few months of the year as many transport firms were forced to stop working because of social distancing orders.

As the pandemic is being contained effectively, transportation activities are resuming but demand had not yet come back to normal.

WCS closed Friday at VNĐ194,000 per share.

Cửu Long Fish Joint Stock Company (ACL) has recently announced it will pay the 2019 dividend in stock at a rate of 135 per cent. 

ACL reported VNĐ1.4 trillion in net revenue in 2019, down 16 per cent year-on-year. Post-tax profit touched VNĐ141.7 billion, down 38.5 per cent year-on-year.

Clever Group Corporation (ADG) last month announced a plan to issue 3.44 million shares to pay the 2019 dividend at a rate of 41.6 per cent. It also plans to issue 6.09 million bonus shares.

Việt Nam National Trade Fair & Advertising Company (VINEXAD) has also paid a 2019 dividend at a rate of 70 per cent in cash. Vinaxad has charter capital of more than VNĐ12.2 billion. — VNS