Property developer SM Prime Holdings Inc. said Tuesday it reduced its dividend payout to a 13-year low as a part of a cash conservation strategy to remain financially flexible amid the coronavirus pandemic.
SM Prime said in a disclosure to the stock exchange the board of directors approved the declaration of cash dividends of P0.185 per share in favor of stockholders of record as of June 30, 2020, payable on or before July 14, 2020.
The cash dividend, with a total value of P5.34 billion, represents 15 percent of the company’s P38.1-billion net income in 2019. The dividend per share is the lowest since June 2007 when SM Prime paid P0.1725 a share and lower than last year’s record payout of P0.35 a share.
“This is both an extraordinary and challenging time for each of us,” SM Prime President Jeffrey Lim said.
“The company is taking all the necessary steps to ensure the well-being of our employees and society. While we maintain a strong balance sheet, the company has decided to prioritize financial flexibility to prepare for what has yet to come. Management sees it best to conserve our resources as we strive to strike a balance between protecting the interest of our stakeholders and maintaining a sustainable growth trajectory for the company over the long-term,” Lim said.
SM Prime remains optimistic about an eventual recovery in consumer spending, owing to the resilience of the Filipino people.
Meanwhile, the company said its financial position would allow it to carry on with the planned expansion in the second half of 2020 moving forward.
The property developer earlier said the P80-billion planned capital expenditures for 2020 remained intact for the year as it focuses on nearly completed projects that are seen to bring about sustainable returns.
SM Prime said it would continue to explore opportunistic acquisitions and/or investments that are well within its core competencies.
SM Prime, through SM Foundation, has supported various government and non-government organizations to contain the spread of the virus including medical tools and equipment to hospitals and front-liners nationwide and food aid to communities hardly hit by the enhanced community quarantine.
SM Prime provided cash assistance to service-provider personnel and a full two-month compensation to all employees despite the stoppage of mall operation and waiving of rent to all mall tenants nationwide.
The company also provided safety help and solutions to various communities in its residential properties, while maintaining optimal operations in its office and hotel businesses.
SM Prime also provided services and access to its properties during this time of crisis including building emergency quarantine facilities and converting Mall of Asia Arena into a mega swabbing facility.