D&L Industries Inc. expects its dividend payout to grow next year on the back of a rosy outlook on its businesses.
The company sees its bottomline growing by at least 10 percent this year, which bodes well for the company’s dividend pay to shareholders.
“If you look at our dividend history, if you look at our historical payout, it usually comes in between 60 and 65 percent of the previous year’s net income. So assuming we follow the same trend, if net income this year is higher by 10 percent that means a dividend next year will also be higher by 10 percent but of course, that final decision will be up to the board of directors,” said Alvin Lao, D&L president.
“At the end of the day, cash dividend is entirely the decision of the directors, but again, just basing it on historical dividends that we’ve paid, coming in at roughly between 60 to 65 percent of net income, it will likely be higher next year,” he added.
The growth of the business is underpinned by a variety of factors the include scheduled increase in blend of bio-diesel to 3 percent from the current 2 percent starting October, of which D&L is the biggest producer of coconut-based additive coco methyl ester (CME).
Lao said D&L is optimistic about the trickling benefit of the monetary policy easing by the central bank which is beneficial to the whole economy.
D&L closed the first half of the year with a profit of P1.31 percent, up 6 percent from the prior year’s P1.24 billion.
