Al-Modawat explains bonus share impact on H1 2025 dividends

Al-Modawat clarifies the impact of increasing capital via a bonus share issue on H1 2025 dividends.

Al-Modawat Specialized Medical Co. said that if shareholders approve the proposed capital increase at the extraordinary general meeting (EGM), the number of shares eligible for the first-half 2025 dividends (second and third installments) will rise to 71.25 million shares from 23.75 million.

The dividend per share would accordingly be adjusted to SAR 0.01 instead of SAR 0.03 per installment, with the payout ratio to the nominal share value revised to 1% from 3% per installment, the company explained in a statement to Tadawul.

The capital increase through bonus shares will not affect the total dividends due to each shareholder, as the per-share dividend will be recalculated proportionally to the increased number of shares after the bonus issuance, Al-Modawat added.

It also said the financial impact will remain unchanged.

According to data available on Argaam, Al-Modawat’s board of directors recommended in April increasing the company’s capital through a 2-for-1 bonus share distribution by capitalizing SAR 47.5 million from the share premium account.

In September, the board approved distributing cash dividends of 9% (equivalent to SAR 0.09 per share) to shareholders over three installments for the first half of 2025.