Uganda-based electricity distributor Umeme Limited has reclaimed its status as the NSE’s highest dividend-paying counter following its book closure.
The company’s dividend yield which closed on Tuesday at 20.4 percent shows Umeme leads the market once more in annual cash returns.
Umeme’s dividend yield had fallen to as low as 12.6 percent ahead of its book closure on June 27, but the share price has since retreated after the closure of the shareholder register for the payout easing to Sh10.95 from a high of Sh17.75 on June 22.
Shareholders are expected to get a payout of Sh2.23 per share on July 20 following the utility’s improved performance.
In March, Umeme raised dividend by 18.6 percent after growing its net profit for the year ended December 2022 to Sh5.162 billion. Previously, the company had paid a dividend equivalent to Sh1.88 per share.
Growth in the company’s profitability was anchored in cost controls that enabled it to offset a slack in the growth of operating profit.
The dividend yield shows how much investors make per year for every shilling invested in a stock.
The yield is usually expressed as a percentage of the stock’s current share price.
Holding the dividend payout means the yield rises and falls with changes in the share price where a rise represents a dip in the yield.
Other top NSE dividend paying counters measured by the yield include StanChart, BAT, BK Group, Stanlib I-REIT and Williamson.
On the flipside, nearly half of the Nairobi Securities Exchange listed firms do not pay a dividend.
Umeme operates a 20-year electricity distribution concession from the government of Uganda and is listed on the Uganda Securities Exchange and cross-listed on the NSE.
The assets and operations of Umeme will be handed back to the Ugandan government after March 2025 after which private shareholders will be compensated.
