Shareholders of listed firm Synergy Grid and Development Philippines (SGP) will benefit from higher cash dividend payout of P0.26 per share in the second quarter this year from a leaner P0.22 per share in the first quarter.
The increased dividend to be paid to outstanding SGP shareholders was approved by the company’s board of directors on Tuesday, June 21. This will also cover the firm’s common shares. The cash dividends will be payable on July 22 this year to outstanding shareholders as of July 6, 2022 record date.
SGP Chairman Henry T. Sy Jr. stated that “the declaration of a higher dividend per share is a result of the recent investment of SGP in preferred shares issued by the National Grid Corporation of the Philippines (NGCP) using the proceeds of the SGP follow-on offering (FOO) last November 2021.”
The issuance of the NGCP preferred shares was approved by the Securities and Exchange Commission (SEC) early this month has entitled SGP to direct dividends from NGCP, the company that operates and manages the power transmission assets of the Philippines.
“This resulted in a higher dividend yield of 8.66-percent per annum at SGP level,” Sy explained. SGP is a holding company that indirectly controls 60-percent of the outstanding common shares of NGCP, currently the listed firm’s sole operating asset.
According to SGP Vice Chairman Robert G. Coyiuto, Jr., “the distribution of dividends is a testament of SGP’s commitment to its partner investors.” And for that, he has been extending gratitude to the investing public “for their trust and confidence in SGP which contribute to the development of the nation’s sole transmission network operated and maintained by NGCP.”
The proceeds from last year’s follow-on-offering of SGP had been funneled to partly bankroll the P440 billion worth of projects that NGCP will be pursuing within the stretch of a more than a decade.
Altogether, the transmission firm had cast 211 projects which are targeted to be concretized “to support the growing electricity demand in the country and to make the country’s power backbone continuously reliable.”
In the next 3-4 years, the capital expenditures (capex) aligned by NGCP under its tariff filing for fifth regulatory reset with the Energy Regulatory Commission (ERC) had been placed at P111.426 billion – and these were blueprinted mainly to reinforce the reliable operations as well as the expansion of the country’s power transmission highway.
For year 2022, the capital spending submitted to the industry regulator amounted to P24.559 billion; and it will be roughly the same at P24.172 billion next year. In the year 2024, that will slightly go down to P22.211 billion; and will further be pared to P14.070 billion in 2025.
The major projects being advanced to completion by NGCP at this point is the P52 billion Mindanao-Visayas Interconnection Project (MVIP), which is anticipated for completion by the end of this year.