Taipei-Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, has decided to issue a cash dividend of NT$2.5 (US$0.08) per share on its earnings for the third quarter.
At a board meeting held Tuesday, TSMC agreed to the dividend for the third quarter after approving cash payouts of NT$2 and NT$2.5 per share on its earnings for the first and second quarters, respectively.
TSMC said the board meeting set March 19, 2020 as the ex-dividend date for its common shares and for its American depositary receipts (ADRs) for the third quarter dividend.
The ex-dividend date is the date on which a stock begins trading without the dividend value. In other words, TSMC shares will begin trading on March 19, 2020 at NT$2.5 less than the closing price the previous day.
Only investors who hold the stock at the end of trading on March 18, 2020 will be eligible for the dividend, which will be distributed on April 16, 2020.
TSMC posted a record high quarterly net profit of NT$101.07 billion for the third quarter, up 51.4 percent from the previous quarter.
That translated to earnings per share of NT$3.9, compared with NT$3.44 in the second quarter.
TSMC approved a proposal last year to issue cash dividends on a quarterly basis starting in 2019 instead of an annual basis, making it the first company listed on Taiwan's stock market to issue quarterly cash dividends.
Analysts said at the time that the quarterly dividend payout is expected to reinforce investors' faith in TSMC shares by boosting their willingness to hold onto the stock instead of buying it just for trading purposes.
In 2019, TSMC has paid out cash dividends of NT$10 per share in two stages: NT$8 in July, on earnings per share of NT$13.54 for 2018; and NT$2 in October, on earnings per share of NT$2.37 for the first quarter of 2019.
At an investor conference in mid-April, Lora Ho (???), TSMC's former chief financial officer, said she expected the cash dividend per share issued on earnings for 2019 as a whole to not be less than NT$10.
At Tuesday's board meeting, meanwhile, TSMC board directors also approved a proposal to assign a capital budget of NT$199.8 billion for new production lines, the installation of advanced technology production equipment, and R and D spending, the company said.
TSMC is gearing up to develop the sophisticated 5 nanometer production process, which is scheduled to start commercial production in 2020, and has set its sights on the more advanced 3nm process, which is likely to begin mass production in 2022.
Source: Focus Taiwan News Channel