Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, has decided to issue NT$2.75 (US$0.085) in cash dividend per share for its earnings in the third quarter of this year.
TSMC held a board meeting on Tuesday to approve the cash dividend payout proposal for the July to September period, when the chipmaker raked in a record NT$280.87 billion in net profit or NT$10.83 per share on the back of solid global demand for smartphones as well as emerging technologies such as high-performance computing devices, automotive electronics, and the Internet of Things.
The chipmaker said the ex-dividend date for the common shares is scheduled for March 16, 2023, and the cash dividends will be paid on April 13.
For most companies in Taiwan that issue cash dividends annually, the ex-dividend date is the date on which a stock begins trading after the cash dividend to be paid out on the previous year’s earnings has been deducted.
TSMC was the first company in Taiwan to issue cash dividends on a quarterly basis instead of annually when it started doing so in 2019. Analysts said the move to pay cash dividends on a quarterly basis is expected to persuade investors to hold the stock longer in a bid to receive quarterly dividends.
Based on the newly announced dividend payout policy, the National Development Fund under the Executive Yuan, the largest single shareholder of TSMC, is expected to pocket about NT$4.55 billion in cash dividends next April as the fund now owns more than 1.65 billion TSMC shares.
TSMC Chairman Mark Liu (劉德音), who holds 12.91 million TSMC shares, is expected to receive NT$35.51 million in cash dividends, while C.C. Wei (魏哲家), the company’s CEO, is expected to bag NT$16.16 million as he owns 5.87 million TSMC shares.
The Tuesday board meeting also approved a capital budget of US$5.71 billion, with the vast majority to be spent on production involving specialty and advanced manufacturing processes.
According to TSMC, advanced manufacturing processes will receive about 70 to 80 percent of the funding, while 10 to 20 percent is to be spent on specialty processes, with the remaining 10 percent earmarked for advanced packaging and testing and photomasking development, the chipmaker said.
In an investor conference held in mid-October, TSMC cut its capital expenditure for 2022 to about US$36 billion from the lower end of a range between US$40 billion and US$44 billion in the previous capex plan, citing market uncertainty in the short term.
The global semiconductor industry is undergoing inventory adjustments at a time when the major central banks have raised key interest rates to fight fast-growing inflation, which has hurt demand.
Source: Focus Taiwan News Channel