After the capital increase, the company led by Miguel Stilwell will distribute their highest dividends ever. Still, there are no changes in the value per share, which remains at €0.19.
EDP shareholders start receiving €753.5 million in dividends this Monday. Although the value per share remains at €0.19, the total amount is the highest ever for the Portuguese company due to the capital increase carried out this year.
The electric company closed 2020 with a net profit of €801 million. This was an increase of 56% compared to the previous year, although the Covid-19 pandemic crisis generated a negative impact of €100 million, to which must be added another €100 million caused by the early closure of the Sines coal-fired plant.
The board proposed that almost all of these €801 million of profits should be handed over to the shareholders as dividends. The proposal was approved at the General Shareholders’ Meeting on April 14 and the remuneration begins to be paid this Monday (subject to withholding tax of between 28% and 25%).
EDP has been paying €0.19 per share to each shareholder since 2016, but the dividend increases this year as the company launched a capital increase in August last year. The 310 million new shares (to 3,965,681,012) represent approximately 8.45% of the share capital.
Although the largest shareholder, China Three Gorges, accompanied the capital increase operation, it subsequently divested from the Portuguese electricity company. The shareholder position was thus reduced to 19.03%, which gives it €143.4 million in dividends. For the second year in a row, the Chinese see their dividend check being reduced. Since it entered EDP’s capital in October 2011, the largest shareholder has received almost 1.5 billion euros in dividends.
In addition to China Three Gorges, there are six other shareholders with qualified stakes (shareholding position of over 2%). The second is the Spanish Oppidum Capital, with a 7.2% stake, which will earn €54.2 million, while BlackRock will be paid €43 million and Norges Bank €23.5 million. The small shareholders who hold over 2.3 billion shares (57.97% stake), who trade on the Lisbon stock exchange, will receive a total of €436,803,848.18.
These are the first dividends to be distributed by new CEO Miguel Stilwell d’Andrade, who has kept the strategy of predecessor António Mexia regarding the minimum dividend. The manager presented a new strategy for the period between 2021 and 2025, in which he says he expects profits to increase by 8% a year to a billion in 2023 and 1.2 billion in 2025. EBITDA could grow 6% to €4.7 billion.