YeboYethu Bucks Trends: Declares Dividend Amid Market Swings, Reveals Vodacom Impact

  • Financial Highlights: YeboYethu reports R377.7 million in dividends from Vodacom but faces a R1,863.3 million loss due to share price decline.
  • Dividend Declaration: YeboYethu surprises with a 92 cents per share interim dividend amid market challenges and a 2,748 cents per share loss.
  • Tax and Logistics: Shareholders face a 20% local dividend withholding tax, with the net ordinary dividend at 73.60000 cents per share.
By Lethabo Ntsoane

YeboYethu (RF) Limited has weathered market challenges, as revealed in its interim results for the six months ending 30 September 2023. The company’s financial statements, accessible on its official website (www.yeboyethu.co.za), present a mixed bag of triumphs and challenges.

Key Financial Highlights

YeboYethu’s noteworthy financial highlights for the specified period include:

  1. Dividends from Vodacom: The company reported dividends received from Vodacom amounting to an impressive R377.7 million. This influx of funds from its primary investment reflects the resilience of the telecoms sector, even in the face of broader economic uncertainties.
  2. Remeasurement Loss: However, the company experienced a setback in the form of a loss on remeasurement on a financial instrument. The decrease in the Vodacom share price from R122.04 as of 31 March 2023 to R105.76 as of 30 September 2023 resulted in a substantial loss of R1,863.3 million for the period.
  3. Finance Costs: The financial period incurred finance costs of R353.8 million, highlighting the ongoing financial intricacies and challenges faced by companies navigating today’s economic landscape.
  4. Debt Reduction: On a positive note, YeboYethu managed to reduce its debt by R314.8 million during the financial period. An additional reduction of R288.3 million is planned post-period end, facilitated by the dividend distribution from Vodacom.

Shareholders’ Impact: Basic Loss and Dividend Declaration

Shareholders, however, bore the brunt of the market fluctuations, with YeboYethu reporting a basic loss per share of 2,748 cents. Despite this, the company remains committed to delivering value to its shareholders.

Interim Dividend Declaration

In a surprising move amid challenging times, YeboYethu’s board declared an interim dividend of 92 cents per share. This decision reflects the board’s confidence in the company’s long-term prospects and its commitment to shareholder returns.

Dividend Breakdown

To further dissect the dividend declaration, here is a breakdown of the relevant dates and figures:

EventDate
Last day to trade shares cum dividendMonday, 11 December 2023
Shares commence trading ex-dividendTuesday, 12 December 2023
Record dateThursday, 14 December 2023
Payment dateMonday, 18 December 2023

Note: Share certificates may not be dematerialized or rematerialized between Tuesday, 12 December 2023, and Thursday, 14 December 2023, inclusive.

Tax Implications

Shareholders should be aware that the interim dividend is subject to a local dividend withholding tax rate of 20%. For those shareholders not exempt from paying dividend withholding tax, the net ordinary dividend will be 73.60000 cents per ordinary share.

Distribution Logistics

On Monday, 18 December 2023, the interim dividend will be electronically transferred into the bank accounts of all certificated shareholders where this facility is available. Shareholders who hold dematerialized shares will have their accounts at their Central Securities Depository Participant (CSDP) or broker credited on the same day.

Vodacom’s Interim Results

It’s important to note that YeboYethu’s primary investment is its stake in Vodacom Group Limited. Concurrent with YeboYethu’s announcement, Vodacom has released its interim results for the six months ended 30 September 2023. Shareholders are encouraged to visit Vodacom’s website (www.vodacom.com) for detailed insights into the telecom giant’s performance.

Looking Ahead: Navigating Uncertainties with Confidence

Despite the challenging economic environment, YeboYethu remains steadfast in its commitment to delivering value to shareholders. The declaration of an interim dividend, amidst the complexities of the market, underscores the company’s resilience and confidence in its strategic investments.

Conclusion

YeboYethu’s interim results reflect a nuanced financial landscape, blending successes and challenges. The declaration of an interim dividend signals the company’s dedication to its shareholders, even in the face of market uncertainties. As investors digest these results, the broader economic landscape will likely shape their perspectives on the resilience and adaptability of South African companies.

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Lethabo Ntsoane

Lethabo Ntsoane holds a Bachelors Degree in Accounting from the University of South Africa. He is a Financial Product commentator at Rateweb. He is an expect financial product analyst with years of experience in reviewing products and offering commentary. Lethabo majors in financial news, reviews and financial tips. He can be contacted: Email: lethabo@rateweb.co.za Twitter: @NtsoaneLethabo