CEZ to pay out record dividend of Kc145 per share

Prague, June 26 (CTK) - The general meeting of semi-state energy group CEZ approved tonight the payout of a record dividend worth Kc145 per share, as proposed by the Finance Ministry, which means it will distribute almost the entire adjusted consolidated net profit of Kc78bn for 2022.

It is the highest dividend in the company's history. The state as the majority owner holding about 70 percent of CEZ shares is to receive Kc54bn.

CEZ's highest dividend to date was Kc53 per share in 2009.

Shareholders did not approve the company board's proposal for a dividend worth Kc117 per share, which would mean the payout of 80 percent of the 2022 profit.

The Finance Ministry submitted the proposal for the increased dividend in mid-June, although it had initially said it would not file its own proposal. The CEZ board subsequently said the firm would be able to cover the payout of the increased dividend without the need to take any extraordinary measures. In the future, however, this may reduce the company's liquidity and credit rating, the board said.

Overall, however, the ministry's proposal does not threaten the company's medium- or long-term financial stability, nor does it have an immediate impact on planned investments, according to the board.

According to unofficial results, the ministry's proposal was approved by a majority of more than 90 percent of votes. This is not surprising, according to analysts.

"For the proposal to pass, it needed to get an absolute majority of those present. With today's turnout of 75.22 percent of all shareholders, the state could decide the dividend amount practically on its own," said XTB analyst Tomas Cverna. The result is positive news for the state budget and minority shareholders, he added.

Finance Minister Zbynek Stanjura said earlier today the higher dividend would bring about Kc10bn more to the state budget. The money would be used mainly to cover the costs caused by high energy prices, that is to compensate households and companies, for housing allowances and for the extraordinary indexation of pensions, he said.

The AGM has so far completed five items out of seven on its agenda today. Discussion on the first item, devoted to the reports of the company's board of directors and supervisory board, lasted more than ten hours, making it the longest ever, company spokesman Ladislav Kriz told CTK.

Most of the shareholders' questions on the first item concerned the potential split of the CEZ group, its record profits last year, the company's approach to the windfall tax and the company's plans for the future.

Subsequently, shareholders approved the company's financial statements for last year, the amount of donations, which are to reach Kc200m this year and Kc250m next year, and a report on the income of the company's bodies.

The AGM also confirmed Vratislav Kostal, former head of the Energy Regulatory Office (ERU), and Vaclav Kucera, a lawyer who previously sat on the supervisory board of Prague gas utility Prazska plynarenska, as members of the CEZ's supervisory board. Both have been proposed by the Finance Ministry. They have only been substitute members so far.

The shareholders did not make any other changes in the supervisory board. One seat still remains vacant.

CEZ's supervisory board has 12 members. The state is represented by eight of them, the rest are representatives of employees. the board is currently chaired by Radim Jirout.

The general meeting was attended by more than 700 shareholders and took 14 hours. The meeting was interrupted for about ten minutes before noon by activists from the Greenpeace movement. They were protesting against the extension of mining in the Bílina mine, which mining company Severočeské doly from the ČEZ group obtained from the mining authority until 2035.

CEZ's net profit rose to Kc80.7bn last year from 2021's Kc9.9bn. According to the company, the significant increase reflects the enormous price increase due to the Russian invasion of Ukraine, record profits from commodity trading on foreign markets and high operational reliability of CEZ's power plants. Operating income increased by 27 percent yr/yr to Kc288.5bn.

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