Companhia Energetica de Minas Gerais
also known as CEMIG
, recently announced the approval of its board of directors
regarding an extraordinary dividend payment amounting to R$1.7
billion or R$1.35 per share. The company's American Depository
Receipt (ADR) gained 0.12% after the announcement on Jun 27.
CEMIG disclosed that this dividend will be disbursed in two
installments to shareholders of record as on Jun 27, 2014. The
first installment of approximately R$0.87 per share will be paid by
Jul 8, while the second installment of roughly R$0.48 per share
will be distributed by Sep 30.
Earlier, on Apr 30, 2014, CEMIG had announced that it will pay a
dividend of approximately R$0.89 per share, amounting to R$1,122.5
million to shareholders, in two installments for the year 2013.
CEMIG follows a consistent policy of rewarding its shareholders by
paying at least 50% of the previous year profit as dividend.
Additionally, as and when the cash position permits, the company is
entitled to pay extraordinary dividends with prior approval of its
board of directors.
In 2013, the company paid R$4.6 billion of dividend and interest on
equity, substantially above disbursements of R$1.748 billion and
R$2.036 billion in 2012 and 2011 respectively.
With a sound dividend policy, we find this Brazilian electric
utility an attractive investment option for long-term investors.
The company's annual dividend yield for 2014 is anticipated to be
6.5%. Also, CEMIG seems well positioned to reap benefits from the
growing electricity demand in the country - an expected annual rise
of 5.9% till 2019, according to the Ministry of Mines and Energy's
(MME) 10-year plan.
CEMIG has a $10.3 billion market capitalization and currently
carries a Zacks Rank #3 (Hold). Some better-ranked companies in the
electric utility industry include
Black Hills Corporation
NRG Energy, Inc.
). All these stocks sport a Zacks Rank #1 (Strong Buy)
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