Next week, on Thursday, March 21, the private company ČEZ, with almost 70 percent state ownership, will publish the results for the last quarter of last year and also for the whole of last year. The management is also expected to present the outlook for this year on this occasion.
Only based on these results will it be clear whether ČEZ has met its year-round goals. And that will indicate what kind of dividend shareholders can expect. CEZ’s dividend policy is to pay out a profit share in the range of 60 to 80 percent of adjusted net profit, which serves as the basis for calculating the dividend. The management set a full-year net profit target for 2023 in the range of 33 to 37 billion crowns.
So it is not difficult to calculate how much CEZ management will offer shareholders for approval. If we are careful and stick to the lower limit of both the estimated net profit and the payout, then the dividend could be about 37 crowns per share. If, on the other hand, we consider a more optimistic option, the proposed dividend could reach 55 crowns. It is certain that the recommendation of CEZ management will certainly be within this range. The proposal probably can’t even be different, unless, for example, the payout ratio changes.
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However, ČEZ is in a situation where it can afford to pay a significantly higher dividend. The government, i.e. the Minister of Finance, who exercises shareholder rights on behalf of the state, can present a counter-proposal to the proposal of the company’s board of directors to the shareholders at the general meeting for approval. And he may want to pay out all of last year’s profit. This could be up to 69 crowns per share. Given the state of state finances, I would bet that this year, like last year, the maximum dividend will be paid. In addition, we are still only starting from the goals, while the reality can be better – as it has been many times before. And if the actual results are better, it would of course also mean a higher dividend.
But in no case will we even come close to last year’s record payment of 145 crowns. And that’s because of the introduction of special taxes and literally brutal resulting taxation. Nevertheless, investors can look forward to a decent dividend yield of about seven percent.
Stock analyst of Komerční banka
2024-03-13 19:05:00
#kind #dividend #CEZ #shareholders
