The share price of Okomu Oil Plc today gained N8.77 to close at N96.49 per share following the announcement of the company’s Board of Directors to pay dividend as well as issue bonus. Okomu is the first quoted company to tread this path of honour recent times. However, the decision of the company to double investors’ reward also has attracted attention to its shares.
The company will pay a dividend of N7.00 per share and issue a new share for every one a shareholder holds.
The N7.00 per share proposed dividend is N2.00 or 40 per cent higher than N5.00 per share dividend paid in the financial year ended December 31, 2011.
However, unlike in 2011 when the dividend was paid twice, shareholders will get it once this time.
It will be recalled that the last time the company issued bonus shares to shareholders was May 2007 when it gave one new share for every two held previously. But unlike the present situation, the company did not give dividend in 2007.
The prospect of distributing bonus shares first emerged when the company held its 32nd annual general meeting (AGM) at the Transcorp Hilton Hotel Abuja on Wednesday, June 13, 2012. At that meeting a special resolution authorizing the increase of the company’s share capital from N300,000,000 to N600,000,000 by the creation of additional 600,000,000 ordinary shares of 50kobo each ranking parri passu in all respect with the then existing 600,000,000 ordinary shares was proposed and approved by shareholders.
Okomu Oil Palm Company Plc is based in Edo State and her principal activities include cultivation of oil palm and rubber, refining of fresh bunches, palm kernel processing and processing of rubber lumps to rubber cake for export. Recent corporate actions emanating from the company seems to be in agreement with her pay-off which says, “Creating Wealth from the soil”.
Prior to the announcement, the company’s price earnings ratio (P.E. Ratio) was 8.81 times while the earnings per share (EPS) was valued at N6.70. Although, the company is yet to release its full financial result for the period, the investing public has started strategizing to participate in the anticipated gains to come from the stock.