Yesterday, Arena Hospitality Group received two dividend counterproposals from PBZ Croatia osiguranje and AZ Mirovinski Fondovi. Initially, EUR 0.75 DPS was proposed by Arena, with a DY of 2.3%. PBZ Croatia osiguranje’s counterproposal is for EUR 1.65 DPS to be paid out, with a DY of 5.1% at the share price before the announcement. AZ Mirovinski Fondovi meanwhile, proposed EUR 1.19 DPS, with a DY of 3.65%.
The two counterproposals were submitted for approval at the GSM, which will be held on 25 April 2024. These were submitted by PBZ Croatia osiguranje, which has an 8.6% share in Arena, and AZ Mirovinski Fondovi, which has a combined share of 14% in Arena.
PBZ Croatia osiguranje submitted the proposal that EUR 1.65 DPS be paid out, which would imply a DY of 5.1% at the share price before the announcement. This is more than double what was initially proposed by Arena (EUR 0.75 DPS, DY of 2.3%). PBZ Croatia osiguranje notes that the initial dividend proposal does not yield a reasonable return for shareholders, especially taking into account the financial status of the Company. PBZ further notes that Arena has a strong balance sheet and positive returns from its operations, and they conclude that the financial status of the Company is favorable. As such, they made their counterproposal.
For AZ Mirovinski Fondovi, they gave a counterproposal which was lower, at EUR 1.19 DPS, implying a DY of 3.65% at the share price before the announcement. AZ wrote a quite detailed overview of their counterproposal, comparing Arena to other listed tourism companies on the Zagreb Stock Exchange, and stating that it was one of the worst performers on several metrics. These include revenue growth (both YoY and compared to 2019), EBITDA growth, net debt to EBITDA, employee expenses, and the highest bonuses for the Management of the Company as compared to its Croatian peers. Furthermore, AZ noted that the return as compared to the IPO price was negative, and this increases further if we take into account inflation which was double-digit in this period. The entire explanation is available here, although in Croatian only.
Because of all of these reasons, AZ counter-proposed the above-mentioned amount. We would also like to note that the ex-date is set for 3 May 2024, while the payment date is set for 15 May 2024. Below we provide you with Arena’s historical dividends, and for 2024 we only include the initial proposal until and if any of the counterproposals are accepted.
Arena Hospitality Group dividend per share (EUR) and dividend yield (%) (2019 – 2024)
Source: Arena Hospitality Group, InterCapital Research
