At the At the share price before the announcement, dividend yield is 13.3%. During the trading session, Cinkarna’s share price increased by 9.6%!
Cinkarna Celje proposed the distribution of accumulated profit as of 31 December 2022. To be specific, the management proposed EUR 21.7m to be distributed as a dividend. The proposed dividend translates into EUR 2.77 per share, compared to EUR 2.1 paid in 2022.
To remind you, Cinkarna did not pay dividends during 2023 as the company was a beneficiary of aid with the goal of mitigating the effects of the energy crisis (ZPGOPEK). According to the aid, the company that claimed aid for the year 2023 should have notified the authority no later than two months after the payment of profits, purchase of own shares, payments or bonuses, etc. In this case, the company should have repaid the funds received, which would be a decision of the authority. Consequently, the loss of the aid would mean greater material damage to Cinkarna (aid is currently projected at EUR 5 – 7m) and ultimately, Cinkarna did not pay any dividends during 2023, resulting in a proposed dividend during early 2024. We do not any additional dividend this year. Cinkarna paid out the dividend during this year so that the Company avoids paying back already received aid (EUR 5 – 7m). However, the dividend was paid from the accumulated profit at the end of 2022. 2023 profit will be “booked in” in the balance sheet due to the aid. However, under the assumption that the Company achieves FY 2023 net profit of EUR 5m (Cinkarna’s estimate) and a payout ratio of 50%, the dividend yield would amount to c. 1% at the current price. So considering everything – we do not expect any additional dividend this year (the next dividend we expect is during 2025 from FY 2024 net profit). But the additional dividend would, anyway, be low, so we think that this dividend of EUR 2,77 (DY = 13,3%) is more than enough to attract investors. The market also approved this, which can be seen in the share price performance in Friday’s trading session.
At the current share price dividend yield is 13.3%. Ex-date is set to 21 February, while the payment date is set to 23 February 2024.
In the graphs below, we are bringing you a historical overview of the company’s dividend per share and dividend yield.
Dividend per Share (EUR) and Dividend Yield (%) (2012 – 2024)
Source: LJSE, InterCapital Research
