Safaricom Makes Dividend Payments Before Set Date

While most companies wait to make their dividend payments on the set date, Safaricom has begun making its dividend payments which had been scheduled for November 30, two and a half months earlier.

Having a gross dividend payment amounting to 74.9 billion shillings, the telecommunication firm began making payments to its retail investors on Saturday, September 14^th. This was done via M-Pesa, the telco’s mobile money service platform used to distribute dividends of below 70,000 shillings.

Ordinary payouts were disbursed at the rate of 1.25 shillings per share while special dividends will be disbursed at the rate of 0.62 shillings per share this week.

Safaricom’s early payment is one of the first among firms listed by the Nairobi Security Exchange, which shows the telco is one that generates a lot of cash.

From Safaricom’s payments, the National Treasury is set to earn a gross payout of 26.2 billion shillings while UK’s Vodafone is set to receive 29.9 billion shillings.

Safaricom’s dividend is said to be well above the net income of 62.5 billion shillings that the company had made by the year ended March.

The telco’s annual report read that the firm had been able to increase its payout because of its financial strength.

“We proposed a special dividend for this year of Sh24.8 billion (Sh0.62 per share). We have a policy of maintaining our dividend payout. However, past dividend payments should not be taken as an indication of future payments.” Reads part of the telco’s annual report.

According to the report, the mobile money service M-Pesa, registered remarkable growth of 19.2 percent, translating to 75 billion shillings, making it the most likely service to increase the firm’s revenue in the coming years.

Voice made a slight increase to 95.9 billion shillings while sales from messaging and mobile data dropped by 1.3 percent and 6.4 percent respectively.

Safaricom has recorded an increase in the number of mobile subscribers to 31.8 million people, and out of that, 22.6 million people are active M-Pesa users.

Since Safaricom’s Initial Public Offering (IPO) on June 9, 2008, it has had a cumulative payout od 301.2 billion shillings, meaning all capital from the Kenyan government and UK Vodafone paid and exceeded by dividends only in 11 years.

To continue making progress, the telco’s plans to continue investing heavily on both existing and new services.