D&L Industries Inc. kept its dividend policy of 50 percent payout ratio based on the previous year’s net income despite the challenging business environment amid the pandemic.
D&L president Alvin Lao said during the annual stockholders’ meeting Friday its board of directors approved a regular cash dividend of P0.183 per share to shareholders of record as of Oct. 2, 2020. The payment will be made on Oct. 28.
Lao said while the current environment remained challenging, the management was confident the company’s operations would continue to be profitable even in a protracted economic recovery scenario given the firm’s robust balance sheet and operational resilience.
This year’s dividend translates into a dividend yield of 3.3 percent based on the closing price of P5.59 on Sept. 17.
The company would pay P1.3 billion in dividends to shareholders, or equivalent to 50 percent of last year’s net income P2.6-billion net recurring income.
D&L Industries’ recurring net income reached P2.6 billion in 2019, down 18 percent from the previous year. The decline in earnings was caused by several factors including inflation scare that started in 2018 that persisted until the first half of 2019, delayed passage of the 2019 national budget and escalation of the various trade wars, including the one between the US and China.
These factors resulted in slowdown in demand in industries that the company catered to.
The company said that while it saw an improvement in its businesses in the first two months of 2020, the early gains were erased as things quickly took a turn for the worse, after the government imposed lockdown which restricted the movement of people and goods to prevent the spread of coronavirus.
Net income fell 43 percent in the first half to P802 million from the same period last year.
The share price of D&L dropped 1.6 percent to close at P5.50 Friday.