Safaricom, a leading telecommunications company in Kenya, has commenced the distribution of a final dividend of KSh 24.84 billion to its shareholders, a move that has been executed two days ahead of schedule. This early payout aims to enhance liquidity within the economy.
Key Points:
- Shareholders of Safaricom received their final dividend payout at a rate of KSh 0.62 per share on Tuesday. This represents a decrease of 17.33% compared to the previous year’s payout of KSh 0.75 per share.
- The reduced final dividend is in line with the company’s 22.2% decline in net profit for the full year ending March 2023. Safaricom’s net profit dropped to KSh 52.48 billion from KSh 67.49 billion in the prior year due to significant capital investments in Ethiopia.
- The National Treasury of Kenya, which holds a 35% stake in Safaricom, is among the major beneficiaries of the dividend distribution.
- The Treasury’s expected gross dividend pay is approximately KSh 8.69 billion for its 14.02 billion shares in the company, a decrease from KSh 10.52 billion in the previous year. Including the interim dividend paid earlier in the year, the total payout to the Treasury would be KSh 16.82 billion.
- Multinational companies Vodacom Group Limited and Vodafone Group Plc, which hold a combined 39.93% interest in Safaricom, are expected to receive a gross payout of KSh 9.92 billion, resulting in a total windfall of KSh 19.20 billion for the year.
- Safaricom’s total dividend distribution for the reviewed year has decreased to KSh 48.08 billion from KSh 55.69 billion in the previous year.
- The company’s profitability was affected by factors such as a slowdown in business operations during the elections period, an increase in excise duty on SIM cards and mobile phones, and a reduction in mobile termination rates set by the industry regulator.
Safaricom’s decision to disburse dividends ahead of schedule and the overall dividend distribution highlights its financial performance and its role in contributing to the Kenyan economy.
