In a move that will likely please investors, Dubai Electricity and Water Authority (DEWA), the emirate's sole provider of electricity and water services, announced approval for a total dividend payout of AED 3.1 billion. The decision comes after a meeting of the company's board of directors held on March 28, 2024.
The announcement highlights DEWA's financial strength and its commitment to rewarding its shareholders. The substantial dividend payout reflects the company's profitability and its ability to generate consistent returns for its investors. This financial strength is likely due in part to Dubai's growing economy and the ever-increasing demand for electricity and water in the emirate.
The windfall for shareholders will be distributed based on a record date set for April 8, 2024. Those who hold DEWA shares prior to this date will be eligible to receive a portion of the AED 3.1 billion dividend pool. The company also revealed that shareholders who had invested before the record date can expect a potential dividend yield of 5% over the next twelve months. This calculation is based on the initial public offering (IPO) share price of AED 2.48 per share.
DEWA's board chairman, Matar Humaid Al Tayer, expressed his gratitude to Dubai's leadership for their vision and guidance. He also emphasized DEWA's vital role in ensuring Dubai meets its growing demand for energy and water. Al Tayer's comments highlight the important link between Dubai's government, its state-owned utilities, and the emirate's economic development.
The news of the dividend payout was well-received by investors. DEWA's stock price remained stable following the announcement, indicating that the dividend amount was within market expectations. The positive response from investors suggests confidence in DEWA's future performance and its ability to deliver strong financial returns.
DEWA's decision to distribute a significant portion of its profits to shareholders underscores the company's financial health and its commitment to transparency. The dividend payout is likely to be seen as a positive development for Dubai's investment climate, potentially attracting new investors to the emirate's utilities sector.