BUA Cement Plc, one of Nigeria’s leading cement producers has recommended a total dividend payout of about N70 billion from the profits made in 2020.
The company will be paying shareholders a dividend of N2.067 per share for all the outstanding 33,864,354,060 ordinary shares of the company.
According to the figures contained in the company’s audited financial statement for the period ended December 31st 2020, the cement giant has now paid about a total of N129.26 billion to shareholders since 2019.
Africa’s 6th richest billionaire, Abdulsamad Rabiu is the majority shareholder of the company, with an ownership stake running in excess of 90% of the outstanding shares of the cement company.
The billionaire owns this stake directly, and indirectly through Damnaz Cement Company Limited, BUA International Limited and BUA Cement Company Limited.
In line with this, we estimate that over 90% of the dividends paid out over the last 2 years were paid to the billionaire industrialist.
The company’s dividend policy
BUA Cement Plc has maintained a dividend payout of more than N1.75 per share in the last two years, and a dividend payout ratio that averages 97.3% over the last two years, with 2019 being the highest with about 98% in the dividend paid out of profits.
- However, the defunct Cement Company of Nigeria (CCNN) that was acquired by BUA Cement, paid shareholders a dividend of N5.3 billion in 2019, which translates to a dividend of 40 kobo per share.
- The dividend payout ratio for 2020 was 96.76%, meaning it retained a meagre 3.24% from the profits it earned during the year.
- Total profits earned since 2019 is about N132.96 billion. Thus, over the last 2 years, it has paid out 97.2% of all its profits as dividends.
- BUA Cement Plc is currently valued at about N2.46 trillion, this valuation is 34x (thirty-four times) the company’s earnings of N72.344 billion in 2020.
- Despite paying out almost all its profits in the last 2 years, the cement manufacturer boasts strong retained earnings of N159.92 billion.
What you should know
- Focusing on price appreciation, the shares of BUA Cement from the price of N35.30 per share on April 1st 2020, are worth about 106% more in recent times, as the market value of the shares of the leading cement maker is currently put at N72.70 per share.
- BUA Cement’s topline revenue rose from N175.52 billion in 2019 to N209.44 billion in 2020, the company’s profits also increased from N60.61 billion to N72.34 billion between 2019 and 2020.
- BUA Cement’s total installed production infrastructure of 8 million MTPA, in line with the cement maker’s strategic midterm expansion program is expected to expand to 20 million MTPA by the end of 2022.
Seplat pegs exchange rate for its final dividend payment at N410.24/$
The value of the naira is down by 6.34% when compared with the N385.78/$ rate the company fixed for its interim dividend last year.
Nigeria’s leading independent oil and gas company, Seplat Petroleum Development Company has announced that an exchange rate of N410.24/$ will be applicable in the determination of its proposed final dividend of $0.05.
The company made this known in an announcement published on the Nigerian Stock Exchange “NGX” website, stating that the rates will be applicable to any shareholder that qualifies for and has elected to receive the dividend payment in Naira or GBP.
Since Seplat is listed on both the Nigerian Exchange Limited and London Stock Exchange, the exchange rates for the naira and the pound sterling amounts payable to shareholders were respectively determined with specific reference to the dollar.
- 1 USD = 410.24 Naira
- 1 USD = 0.7197 GBP
What you should know
The CBN official exchange rate currently stands at N379/$. Checks at the time of drafting this report revealed that the Naira rate adopted by Seplat for the payment of its final dividend is the official rate for foreign exchange spot operations in the Investors and Exporters FX Window (NAFEX).
The recent exchange rate disclosed by the oil company speaks volume about the persistent fall in the value of the naira which is down by 6.34% when compared with the N385.78/$ rate the company fixed for the payment of its interim dividend six months ago.
What this means
The exchange rate proposed by the company seems fair as it holds a fairly robust premium of N31.24/$ when compared with the CBN rate of N379/$.
However, the Seplat rate is -15.41% or -₦74.76/$ low when compared with the parallel market rate of N485/$1.
Nigerian stocks you can buy today and still qualify to earn dividends
The conditions given by a number of companies on NGX provide new investors with the opportunities to benefit from their dividends.
Listed entities on the Nigerian Stock Exchange “NGX” have taken active steps to make their shareholders happy and this is evident in the juicy dividends which these companies have announced so far in 2021 from the profit which they made through their operations in 2020.
Since the companies will be paying shareholders from the profit which they made last year, one would think those qualified to earn these dividends are investors who bought some ownership stakes in the company last year or those that bought the shares of the company early in 2021.
Interestingly, this is not so as the conditions given by a number of these companies provide new investors with the opportunities to benefit from these dividends.
These conditions are flexible enough to permit anyone who buys stakes in these companies today the 27th of April, to receive dividends payment as stated in the companies’ initial dividend disclosure.
Conditions for qualifying shareholders
To qualify for this payment there are some key important rules to abide by as a qualifying shareholder.
- Shares of the listed company must be bought at least 3 working days before the dividend qualification date.
- Shareholders must have completed the e-dividend registration and mandated the Registrar to pay their dividends directly into their bank accounts.
Nestle Nigeria Plc (NESTLE)
The company in its guidelines revealed that only shareholders whose names appear in the Register of Members on May 21 2021, will be paid a final dividend of N35.50 per share.
Hence, to qualify for this dividend, new shareholders must purchase shares of this company not later than three working days before the 21st of May 2021.
The dividend yield of the company’s shares is put at 2.50%, as Nestle shares are valued at N1,450 per share at the open of market this morning.
By June 23, 2021, the dividends will be paid electronically to shareholders whose names were entered into the Register of Members before the deadline date.
Lafarge Africa Plc (WAPCO)
Lafarge recently announced that a final dividend of N1.00 per share will be paid to shareholders of the company whose names appear in the Register of Members as at 30th April 2021.
This means to qualify for the dividend payment, shares of the cement manufacturer must be purchased today, the 27th of April.
With the shares of Lafarge Africa Plc valued at N22.3 price on the exchange this morning, the company’s dividend yield is put at 4.48%.
The proposed dividend, if approved at the company’s Annual General Meeting will be paid on Tuesday, 25th May 2021 to the qualified shareholders.
MTN Nigeria Communication Plc
MTN has also set-out clear instructions in an announcement for investors to qualify to receive the proposed dividend payment of N5.9.
In line with the disclosure only shareholders of the company whose names appear in the Register of Members as at 4th of May 2021 will qualify to receive the dividend.
The dividend yield of the company’s shares is put at 3.58%, going with MTN’s market open price of N165 per share.
On May 26, 2021 the dividends declared by MTN will be paid to shareholders of the company whose names appear on the Register of Members as at May 4, 2021.
BUA Cement Plc (BUACEMENT)
The cement company in a recent disclosure informed the investing public that a dividend of N2.067 kobo has been proposed by the company’s board.
BUA Cement added that the dividend will be paid on July 23, 2021, to shareholders whose names appear in the Register of Members as at the close of business on July 9, 2021.
This means that to qualify for this dividend, the shares of the company must be purchased not later than three working days before the dividend qualification date.
With the N72.7 price of BUA Cement shares as of today’s open, the dividend yield of the company is put at 2.84%.
UAC of Nigeria Plc
The company in its guidelines revealed that only shareholders whose names appear in the Register of Members on June 14 2021, will be paid an ordinary dividend of 65 kobo per ordinary share; and a special dividend of 55 kobo per ordinary share, bringing the total dividend payout to N1.20 per share.
Hence, to qualify for this dividend, new shareholders must purchase shares of this company not later than three working days before the 14th of June 2021.
The dividend yield of the company’s shares is put at 10.95%, as its shares are valued at N10.95 per share at the open of market this morning.
By July 1, 2021, the dividends will be paid electronically to shareholders whose names were entered into the Register of Members before the deadline date.
What you should know
- It is standard practice that companies with strong financial performance pay shareholders dividends from profits, this practice allows shareholders to reap economic gains from the companies in which they own shares.
- On the dividend qualification date, the shares of these companies will be marked down on the Nigerian Stock Exchange, to reflect the total amount of dividend per share that shareholders will receive.
- After the approval of the dividends at their Annual General Meetings, companies maintain the culture of paying shareholders their dividends on the next business day after the AGM.
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