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A drop of 7% in PALTEL’s profits and the company recommends 45% cash dividends


Sahem Weekly Trading Report (8-12)/02/2015

Within transactions that were increased by institutional deals, activation in the price movements of Al-Quds appeared due to the leading companies’ stocks’ momentum, to stabilize above the 500-points level at the end of the week. On the other hand, the stock of Palestine Telecommunications PALTEL constitute an essential leverage for the Index’s gains after proposing distributing 45% cash dividends for the year 2014 to the general assembly.  According to the proposal, PALTEL record dividends yield of 7.58%, based on the current market price. It is worth mentioning that the company approved distributing 50% cash dividends for the year 2013; 40% cash dividends for the year 2013 and 10% exceptional cash dividends for the company’s investments in 2013.  This proposal that came prior to disclosing the financial data FY2014, was reflected in the stock’s performance, whereby, the purchasing orders accumulated around the previous week’s levels, leading the stock to gradually increase, touching levels that had abandoned since March 2014 due to the price depths. In total, PALTEL’s stock closed at the level of JD5.94; up by 2.41% through active transactions that constituted 57.59% of Palestine Stock Exchange PEX’s trading value; supported by executing an institutional transaction in the last session of the week.  On the other hand, the week ended with PALTEL’s disclosure of posting net income of JD85.07 million at the end of 2014, compared to JD91.83 million at the end of 2013; down by 7.36%. This decrease came due to a decline in the operating income by 14.84%. However, PALTEL recorded investment income of JD3.03 million, to record payout ratio of 69.66% based on the EPS of 2014.

On the other hand, the listed companies’ announcements about their FY2014 financial data disclosures accelerated; to create a momentum in this week. However, the legal period granted for these disclosure ends on Sunday 15/02/2015.  Coinciding with the disclosures, some companies proposed dividends distributions.  In this context, the board of directors BOD of Birzeit Pharmaceuticals Company BPC proposed to the general assembly GA, distributing 17% cash dividends, to record payout ratio of 68.27% based on the EPS of 2014. Whereby, BPC announced reporting net income attributable to the shareholders of the parent company of $4.54 million; down by 16.43% than what was reported in the year 2013. This came as a result of an increase in the finance costs that dominated the increase in the operating income. Moreover, the BOD of the Arab Company for Paints Products APC proposed distributing 35% cash dividends to the GA that will be holding a meeting on 15/02/2015, to record payout ratio of 90% based on the EPS of 2014.

Regarding the annual financial data disclosures, the Vegetables Oil Industries Company VOIC announced recording net income of JD4.95 million at the end of 2014, compared to net income of JD4.83 million at the end of 2013. This increase came due to the relative stability in the gross income, in addition to an increase in the selling and distribution expenses versus a soar in the company’s stake from associates’ profits, to record EPS of JD1.24. In the same context, Palestine Securities Exchange Company PSE- the operator of the PEX- announced posting net income of $0.24 million at the end of 2014 compared to net loss in the corresponding period. These profits came due to an increase in the operating revenues, interest revenues and leasing revenues versus shrinking the general and administrative expenses. According to the disclosed data, the book value BV of the company reaches $1.04 as for 31/12/2014.





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