Today, Samsung Board approved stock split requests and the year-end dividend to enhance shareholder value. The two approvals provide the investors with not just liquidity and marketability but also clarity and predictability on the company’s stocks and shareholder returns.
The Korean tech brand has been receiving ‘numerous’ requests for a stock split as high share price would delay the potential investors. These requests have increased last year with the share price of the company rising higher. Therefore, the approval of the 50:1 stock split announced today gives investors better access to Samsung’s shares.
The approval further opens doors for more investors to enjoy dividend, starting 2018. Ultimately, this all leads to the company’s corporate value improvements for ‘long term.’
On the way to further increment in shareholder value, shareholder returns as well come into the mix. Today’s approval of year-end dividend includes KRW 21,500 per common share and KRW 21,550 per preferred share.
The 2017 annual dividend counts to KRW 5.8 trillion, equalling a 46-percent YoY increase. This is a part of dividend-focused return strategy of Samsung for the time period of 2018-2020, on which its board of directors will allocate the entire 50% of Free Cash Flow to the 2017 dividend.
This will complete Samsung’s three-year shareholder return program through 2017. During last October, the company announced the next three-year shareholder return policy for 2018-2020, and it includes year-end dividends of KRW 9.6 trillion.
Samsung’s announcement blog reads: “Our management and Board will work tirelessly to make the Company more competitive and profitable, and we remain committed to increasing shareholder value through enhancing shareholder returns.”