Axelum Resources Corp., a listed affiliate of the Metro Pacific Group and a fully integrated manufacturer and exporter of premium coconut products, announced on Friday that its board of directors has approved a dividend policy to distribute up to 30 percent of its net income from the preceding year.
Under the policy, dividends will primarily be paid in cash within 30 days from the declaration date. However, the Axelum board has the discretion to choose whether to pay dividends in property or shares instead of cash.
The policy stipulates that dividends will only be declared from the company’s unrestricted retained earnings. These earnings represent the net accumulated profits of Axelum, with capital that is unimpaired and isn’t earmarked for any other purpose.
For stock dividends, approval from at least two-thirds of the company’s outstanding capital stock is required during a regular or special meeting called for this purpose. Axelum will also conduct periodic reviews of its unrestricted retained earnings to decide whether surplus funds will be allocated for future capital expenditures or distributed as special cash or stock dividends. The dividend policy will be periodically reviewed and altered if necessary.
The payment of cash dividends will be subject to board approval and will depend on various factors, including the Axelum’s earnings, cash flow, financial condition, future expansion plans, and operational requirements.
For some investors, especially long-term ones, a clear dividend policy is important because it helps set expectations for future returns on their investments.
