Amaechi Raphael Chinedu
@Official_ARC·10h
Cash or shares? How PZ Cussons' dividend choice works, with the maths
PZ Cussons (
$PZ ) is paying a ₦2.50 final dividend, and shareholders get a choice: take it as cash, as new PZ shares, or a mix of both. This is called a scrip dividend, and the deadline to choose is this Friday, Oct 23.
How the number of new shares is worked out, according to the company's explanatory note:
1. Start with your gross dividend: shares held × ₦2.50.
2. Take off 10% withholding tax. What's left is your net dividend.
3. Divide the net dividend by the reference price, which is the average PZ closing price over the 10 trading days from Oct 12 to Oct 23.
4. Only whole shares are issued. Any leftover fraction is paid to you in cash.
An illustration: 10,000 shares gives a ₦25,000 gross dividend, or ₦22,500 after tax. PZ closed at ₦64.50 on Monday, so if the reference price landed there, that would buy 348 new shares, with about ₦54 paid in cash. The real reference price won't be known until after Friday.
What people weigh when choosing:
- Cash is certain and due on Oct 30. Shares grow your stake without brokerage fees, but their value moves with the share price. PZ is up about 43% this year, yet down roughly 14% over the past four weeks.
- Tax comes off either way.
- Every holder who picks shares lets the company keep that cash for the business. New shares also mean each existing share becomes a slightly smaller slice of the company.
- Doing nothing means cash. Getting shares means sending the election form to the registrar, First Registrars, by 5 PM WAT on Friday. If your shares are held through a stockbroker, check with them, as they may set an earlier cut-off.
- It only applies to holders on the register at close of business Oct 9, and it still needs shareholder approval at the Oct 28 AGM plus SEC, NGX and CAC sign-off. If those don't come through, everyone is paid in cash.
Would you take the cash or the shares? Tell us below 👇
Not financial advice.
$PZ ) is paying a ₦2.50 final dividend, and shareholders get a choice: take it as cash, as new PZ shares, or a mix of both. This is called a scrip dividend, and the deadline to choose is this Friday, Oct 23.
How the number of new shares is worked out, according to the company's explanatory note:
1. Start with your gross dividend: shares held × ₦2.50.
2. Take off 10% withholding tax. What's left is your net dividend.
3. Divide the net dividend by the reference price, which is the average PZ closing price over the 10 trading days from Oct 12 to Oct 23.
4. Only whole shares are issued. Any leftover fraction is paid to you in cash.
An illustration: 10,000 shares gives a ₦25,000 gross dividend, or ₦22,500 after tax. PZ closed at ₦64.50 on Monday, so if the reference price landed there, that would buy 348 new shares, with about ₦54 paid in cash. The real reference price won't be known until after Friday.
What people weigh when choosing:
- Cash is certain and due on Oct 30. Shares grow your stake without brokerage fees, but their value moves with the share price. PZ is up about 43% this year, yet down roughly 14% over the past four weeks.
- Tax comes off either way.
- Every holder who picks shares lets the company keep that cash for the business. New shares also mean each existing share becomes a slightly smaller slice of the company.
- Doing nothing means cash. Getting shares means sending the election form to the registrar, First Registrars, by 5 PM WAT on Friday. If your shares are held through a stockbroker, check with them, as they may set an earlier cut-off.
- It only applies to holders on the register at close of business Oct 9, and it still needs shareholder approval at the Oct 28 AGM plus SEC, NGX and CAC sign-off. If those don't come through, everyone is paid in cash.
Would you take the cash or the shares? Tell us below 👇
Not financial advice.0 views
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