Airtel Uganda declares Shs86b dividends

Airtel Uganda has announced a final total dividend of Shs2.15 per share for 2023 for its investors and for some this will be their second return on investment. 
The board of directors of the telecom company suggested that the Shs86 billion payout comes from the company's total retained earnings as of December 31, 2023. 
Airtel estimated that by December 31, 2023, its retained earnings would reach Shs27.04 billion, as disclosed in its 2023 IPO prospectus.

The company announced today that, subject to the directors' approval, the dividends will be distributed to shareholders who will be listed on its books by March 26 -  on or around April 15.
Airtel made an IPO promise to win over investors; 95 percent of retained earnings or net profits after tax, whichever was higher.

Right after listing, its records show that shareholders had grew to 4,600.
The company paid a 2023 quarter-three interim dividend on December 21, 2023, valued at Shs76.00Bn, or Shs1.90 per share.

According to the announcement made today, Bharti Airtel, which owns 40 billion shares, or 88.11 percent of the local company will receive at least Shs75.7 billion. Uganda's National Social Security Fund (NSSF), which acquired 4.2 billion shares, or 10.55 percent of the stake, will come in second with Shs9.03 billion.

This year's dividends are the lowest Airtel has announced in the past five years. The company distributed Shs25,475 per share in 2022, for a total payout of Shs358.7 billion, or 110 percent of net profit after taxes for that year because it had few shareholders. At this point, Bharti Airtel Uganda and Bharti Airtel Africa held the majority of its shares—40 billion and 28,000, respectively.

However, the Uganda Communications Commission had mandated that it lists 20 percent of its stake, so in late 2023, it offered to list 8 billion shares. However, the market was only prepared to accept 4.36 billion shares, or 10.89 percent of its stake.

The 2023 financial results of Airtel Uganda reveal that the company's profits after tax of Shs296.95 billion were less than the Shs457.03 billion that was predicted in its IPO prospectus' forecast.
A contributing factor in this is the 26 percent increase in sales costs from Shs333.96 billion in 2022 to Shs424.05 billion in 2023, its financial results show.

After MTN Uganda, which is also listed on the Uganda Securities Exchange (USE), Airtel Uganda became the second telco in the country to go public.