Contact Energy Sets NZD 0.1847 Dividend with No DRP Discount
Contact Energy Limited has announced a fully unfranked dividend of NZD 0.1847 per share, combining ordinary and supplementary components, payable in March 2025.
- Dividend of NZD 0.18470588 per share declared
- Includes ordinary dividend of NZD 0.16 and supplementary dividend of NZD 0.0247
- Ex-dividend date set for 24 February 2025
- Payment date scheduled for 18 March 2025
- Dividend Reinvestment Plan (DRP) available with no discount
Dividend Announcement Overview
Contact Energy Limited (ASX: CEN) has confirmed a dividend distribution totaling NZD 0.18470588 per ordinary share, reflecting the company’s financial results for the six months ended 31 December 2024. This dividend comprises an ordinary dividend of NZD 0.16 and a supplementary dividend of NZD 0.02470588, the latter payable to non-New Zealand resident shareholders.
The dividend is fully unfranked, consistent with Contact Energy’s status as a New Zealand entity, and carries a withholding tax rate of 15% for applicable shareholders. The ex-dividend date is set for 24 February 2025, with the record date following on 25 February 2025. Payment of the dividend will occur on 18 March 2025.
Dividend Reinvestment Plan Details
Shareholders have the option to participate in Contact Energy’s Dividend Reinvestment Plan (DRP), which is offered without any discount on the reinvestment price. The DRP price will be calculated based on the volume weighted average sale price of shares traded on the NZX Main Board over the five trading days commencing 24 February 2025.
Notably, the DRP is only available to shareholders with registered addresses in New Zealand or Australia. The deadline for DRP election is 26 February 2025 at 3:00 pm, with the issue date for DRP shares aligned with the dividend payment date on 18 March 2025. Shares issued under the DRP will rank pari passu with existing ordinary shares from the date of issue.
Implications and Market Context
This dividend announcement underscores Contact Energy’s ongoing commitment to returning value to shareholders amid a dynamic energy sector environment. The unfranked nature of the dividend is typical for New Zealand companies and may influence the after-tax income for certain investors, particularly those outside New Zealand.
Investors will be watching closely how this dividend fits within Contact Energy’s broader capital management strategy, especially given the company’s exposure to fluctuating energy prices and regulatory conditions in the Australasian market. The availability of the DRP without a discount may also signal confidence in the company’s share price trajectory.
Bottom Line?
Contact Energy’s steady dividend payout signals confidence but invites scrutiny on future earnings sustainability.
Questions in the middle?
- How will Contact Energy’s unfranked dividend impact international investors’ after-tax returns?
- What are the company’s plans for capital allocation beyond this dividend cycle?
- Could changes in energy market conditions affect future dividend policies?
