Listed Korean companies are expected to shell out a record interim dividend upon closing their half-year statements in June as they comply with stronger shareholder demands under the practice of the stewardship code.
According to the Financial Supervisory Service on Sunday, 44 listed companies in Korea have declared interim dividend payouts for the second quarter as of June 14, up from 38 last year. The number of Korean companies issuing semi-annual dividends has been gradually increasing, from 29 in 2016 to 35 in 2017.
The total value of interim dividends is also poised to hit a new high this year. The payment last year had been a record 3.17 trillion won ($2.67 billion), up from 1 trillion won in 2017 and surging more than sevenfold from 2014, according to local financial data provider FnGuide.
Big payers last year, including industry heavyweights such as Samsung Electronics, Hyundai Motor, SK Innovation, Hana Financial Group and Posco, are set to deliver interim dividends again this year.
Six companies have announced their first-ever interim dividends as of last Friday, including Hyundai Mobis, Lotte Corp., Miwon Specialty Chemical, Cowell Fashion, Echo Marketing and Haimarrow Food Service.
Hyundai Mobis plans to give out 1,000 won per share, about one-fourth the amount of its annual dividend payout last year.
Lotte Corp. would also be handing out its first interim dividends since its reorganization into Lotte Group’s holding entity in August 2017. It had then pledged to raise its dividend payout ratio by up to 30 percent and to start delivering interim dividends.
To qualify for this year`s interim dividends, shareholders need to have their stock purchase completed by June 26, two trading sessions before the record date of June 30. The exact size of the payouts would be finalized in July by the board of the respective companies and paid out within 20 days from the board meeting.
Since adopting the stewardship code in July 2018, Korean companies have been pressured to up their dividends, which have been historically lower compared to those of their global peers, a key reason why Korean stocks have been generally undervalued. The stewardship code is a set of guidelines that encourages institutional investors to exert their shareholder rights and be more active in corporate management.
The total dividend payout of firms listed on the country’s benchmark Kospi hit a record 30 trillion won in 2018, up 9.23 percent from the previous year.
By Yoo Joon-ho and Kim Hyo-jin
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]