Premiere Island Power REIT [PREIT 1.51 0.7%; 121% avgVol] [link] declared its Q1 cash dividend of P0.0299/share, payable on July 17 to shareholders of record as of July 7. The dividend has an annualized yield of 7.92% based on the previous closing price, which is smaller than PREIT's pre-dividend annualized yield of 9.5%.
The total amount of the dividend is P98 million, which is 90% of the P109 million in distributable income that PREIT reported for the quarter. Relative to PREIT's IPO price, the dividend increased PREIT's total stock and dividend return to 9.2%, up from its pre-dividend total return of 7.21%.
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This is PREIT’s first proper quarterly dividend, and it’s probably not what IPO investors were expecting.
The company’s REIT Plan forecasted that it would maintain a yield of 9.6% based off its IPO price of P1.50/share, and based on P0.1434/share of total annual dividends. This dividend extrapolates out to an estimated annual dividend of just P0.1196/share. That’s significantly lower.
The company didn’t provide a press release with the declaration to provide context as to why this dividend might be lower than forecasted in the REIT Plan, but PREIT has a little bit of a history of doing stuff like this, even if it’s only been on the exchange for less than a year. If we assume that this dividend is representative of what it will declare for the rest of the year, PREIT would need to drop 17% to P1.25/share for this income stream to represent the forecasted 9.6% yield.
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