Reuters/Bangkok
Thailand’s state-controlled energy giant PTT has carved out a record slice of its income as dividends, totalling almost $1bn, even though its annual net profit dropped to a six-year low in 2014.
After Australia’s Woodside Petroleum, PTT’s so-called dividend payout ratio of 56.9% is the highest in the Asia-Pacific for listed oil and gas firms with a market cap of at least $20bn, Thomson Reuters data shows. PTT increased the ratio even as falling oil prices and losses from fuel subsidies pushed Thailand’s biggest listed company to post its worst-ever quarterly loss.
Like Woodside, PTT has become a high-yielding energy play with its generous dividend payouts. The high ratio is to assure shareholders, CFO Wirat Uanarumit told Reuters yesterday. Major stakeholders – the finance ministry and state-run Vayupak Fund – will get 21bn baht ($639.66mn) in dividends, according to Thomson Reuters calculations based on their shareholdings. The payout is timely as Thailand’s military government prepares to revive the economy with a bout of infrastructure spending.
Given widespread expectations the oil price slide is bottoming out, analysts say PTT’s payout ratio has probably peaked, though much depends on the company’s priorities. PTT says it spends most of its profits on expansion at home and overseas to secure energy supplies, because the government does not have a policy of allocating part of its budget to acquire energy resources.
“We expect PTT to pay a dividend of 10 baht (per share) for this year’s performance, which reflects a normal payout rate of 35%,” said Benjaphol Suthwanish, an analyst at Bangkok-based KK Trade Securities. “Going forward, it’s quite difficult to estimate the dividend payment given that it’s up to the board and the company’s long-term investment plan.”
