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Christmas in July: Who’s Getting a Bulk of Php2.1-B Dividend that Ayala Corp is Paying Out?

The country’s longest-existing business house was scheduled to distribute dividends on July 22
By Pauline Macaraeg |

 

 

 

The peso may be falling and the stock market outlook remains under a cloud after the benchmark Philippine Stock Exchange Index (PSEi) turned bearish in early July amid global and domestic uncertainties.

 

However, shareholders of listed Ayala Corp., the country’s longest-standing business group and one of its largest conglomerates, have reason to celebrate this month. Yesterday, July 22, happens to be the date when Ayala Corp pays out cash dividends of Php3.46 a share to holders of the company’s outstanding common shares, which stood at 621.8 million as of June 2018.

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The company’s board of directors earlier agreed in June to grant the cash dividends to shareholders of record as of July 6. The total value of the cash dividends that was to be distributed on July 22 was around Php2.15 billion.

 

Ayala Corp. reported earnings of Php49.9 billion from revenues of Php266.8 billion in 2017. This is a 14.8-percent increase from its 2016 net income of Php43.4 billion and a 19.7-percent growth from revenues of Php222.9 billion.

 

Last year, Ayala Corp. paid out cash dividends of Php3.46 per share to common shareholders twice—in July and December. It remains to be seen if the company will declare another cash dividend later this year.

 

A huge company like Ayala Corp. has hundreds of common stockholders but only a few really own sizeable stakes in the holding company. A close look at the company’s top 100 shareholders shows that a single company, Mermac Inc., the Ayala family’s privately held holding firm, own almost half of Ayala Corp.’s common shares.

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This means that almost half of the Php2.1-billion dividends paid out on July 22 would also be going to Mermac, and indirectly to its major individual shareholders such as brothers Jaime Augusto and Fernando Zobel de Ayala who are at the helm of the company.

 

Next to the Zobel family-owned Mermac Inc., the other major identified common shareholders of Ayala Corp. are Japan’s Mitsubishi Corp. and three holding firms owned by the Sy family: Shoemart Inc., Sysmart Corp. and SM Investments Corp.

 

Companies belonging to the Ayala and SM Group compete across several industries from shopping malls, property development and banking, among others. It’s interesting to note that Sy-owned companies are among the top shareholders of Ayala Corp. The Sy-owned companies, and, indirectly, members of the Sy family, are also among the top recipients of the cash dividends though the amount they’ll be getting pale in comparison to what Mermac will be receiving.

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Pauline Macaraeg is Entrepreneur PH's data journalist. Follow her on Twitter @paulinemacaraeg

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