EDL Gen shareholders to get first dividend
Shareholders in EDL Gen, one of the country's major electricity generators, will get their first dividend towards the end of this year, according to BCEL KT.
The securities company announced this week that EDL Gen has decided to pay a half-year dividend of about 178 kip per share, hoping to transfer the money into shareholders' accounts in October.
However, shareholders will receive an after-tax dividend of about 160 kip per share. The dividend payment comes from 82 percent of the public company's gross profit over the first six months of this year.
BCEL KT explained that EDL Gen may pay a larger dividend in the second half of this year because heavy rainfall enabled the company to generate more power for sale.
According to its mid-year financial statement, EDL Gen generated about 308 billion kip from the sale of electricity to EDL from January to June, resulting in a net profit of about 188.5 billion kip over this period.
The company plans to generate revenue of about 793 billion kip this year and make a net profit of about 550 billion kip in 2011.
According to brokers, the first EDL Gen dividend is in line with company policy to disburse at least 50 percent of its net profit as shareholder dividends. Payments will be made once or twice a year.
Brokers were optimistic that the dividend payment will encourage Lao people to buy more shares in the power company, as they will have gained a clearer picture of the benefits of investing in the stock market, which began trading in January this year.
Most Lao investors decided to invest in the stock market because they wanted to receive dividends rather than make a profit from stock trading. Lao people have little experience in stock trading as the concept is new to the country.
The trading volume of EDL Gen shares has fallen in recent months despite a report indicating consistent growth.
Many Lao investors have said they do not understand the technical information contained in the profit reports of listed companies so they cannot make informed decisions about when to buy and sell off stocks.