Airtel is paying up to $41m in dividends after Uganda IPO
TLDR
- Airtel Uganda declares a final dividend payout of Ush86 billion ($22 million) despite a 9.6% profit decrease.
- The total dividend distributed reaches Ush162 billion ($41.47 million) since the company's IPO in November.
- Shareholders to benefit from the commitment to allocate at least 95% of annual net profit as dividends.
Airtel Uganda has announced a final dividend payout of Ush86 billion ($22 million) following a 9.6% decrease in profit for the fiscal year ending in December 2023.
This additional dividend adds to the interim dividend of Ush76 billion ($19.45 million) declared and disbursed shortly after the company's initial public offering (IPO) in November of the preceding year. With this latest dividend declaration, the telecommunications company will have distributed a total of Ush162 billion ($41.47 million) since becoming a publicly listed entity.
The Ugandan unit had committed to allocating a minimum of 95% of its annual net profit or retained earnings as dividends to shareholders. Additionally, the company had projected the possibility of paying out up to Ush500 billion ($127.98 million) in dividends during the period under review.
Key Takeaways
While the company reported a growth in total revenues, which expanded by 11.5% to Ush1.7 trillion ($455 million), primarily attributed to the positive performance in core voice and data business segments, earnings were dampened by increased costs, notably in other operating expenses, which surged by 36.4 percent to Ush159.1 billion ($40.7 million). In addition, network operating expenses experienced a notable uptick, rising by 25.1 percent to Ush314.4 billion ($80.5 million). Airtel Uganda is the second telecom company to go public in the country after MTN Uganda in 2021. The move aligns with new license requirements for telecom companies, mandating them to list 20% of their stake to Ugandans. Airtel's listing is anticipated to attract more foreign investors, potentially shifting the balance as foreign investors currently dominate the trading of Uganda's listed companies, accounting for 60%. The aim is to enhance market competitiveness and liquidity.
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