Small businesses pay surprisingly high dividends
On February 28, the Board of Directors of CNG Vietnam announced that the dividend for 2011 would be 70 percent (7000 dong per share), while the figure for 2012 would be 35 percent.
Prior to that, CNG advanced 25 percent on the 2011 dividends (15 percent in cash). As such, CNG has become one of the businesses which pay high dividends. The market price of CNG shares is 26,000 dong.
The company pays high dividends following the good business performance in 2011 with the total revenue reaching 748 billion dong, the post tax profit of 203 billion dong – a very high figure if compared with the chartered capital of 200 billion dong.
Many other small and medium enterprises have also reported the high dividends for 2011, namely ABT (paid 60 percent), DSN (52 percent), DVP (40 percent), AAM (advanced 30 percent), GIL (paid 40 percent), SDG (advanced 3 percent) and NTL (advanced 25 percent).
Other businesses have not announced the dividends, but they plan to submit to the shareholder’s meeting the plan to pay dividends at over 30 percent. Some other businesses reportedly have the EPS (earning per share) at over 10,000 dong per share, namely HGM (25,000 dong), BMC, KSB, NNC, DRP, TRC. With such good business results, the companies’ shareholders can expect big dividends.
The figures show the encouraging results of businesses, if noting that 2011 was a very difficult year for them, when the inflation rate climbed to 18 percent and the interest rate was 25 percent per annum.
Big businesses pay modest dividends
The stock market in 2011 witnessed a lot of businesses lowering their targeted profits, or paying dividends at low levels. Surprisingly, these comprised big scale businesses.
Sacom on February 28 announced that it incurred the loss of 188.5 billion dong in 2011, while it made a profit of 118 billion dong in 2010.
SAM has the chartered capital of 1310 billion dong, but its capitalization value has dropped to 693 billion dong, because the shares are traded at 5000 dong per share. With such a big loss, the plan to pay dividends of the company has failed completely.
The two other “big guys” who also took loss are Ocean Group and Quoc Cuong Gia Lai. The latter group incurred the loss of 38.63 billion dong in 2011. The former unexpectedly reported the loss of 18.4 billion dong for the fourth quarter of 2012 due to the increasing finance costs. The group still could make a profit of 182.75 billion dong in 2011, but this represented the sharp fall of 68.8 percent from the previous year.
Many other big guys also incurred loss in 2011, including SJS (71 billion dong), TLH (40 billion dong), NVT (70.3 billion dong) and VSP (535 billion dong).
With the big loss, the businesses are believed not to pay dividends for 2011. Other businesses made profits, but they do not plan to pay dividends or pay at low levels. These include Minh Phu Group, Tien Phong Plastics, Vinaconex.
Suffering from the greed
The majority of the businesses that pay high dividends are the ones with small and medium scale which focus on single business fields. These include ABT, AAM, AGF, AGD, ACL, specializing in seafood, DPR, PHR, TRC in rubber, KTS and BHS specializing in sugar, while BMC, KSB and NNC in minerals.
Meanwhile the unprofitable businesses or the businesses which saw profits drop dramatically in 2011, are the ones which operate in many business fields, or have the investments in the real estate sector.
Manh Ha
Business & Investment Opportunities
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