Following consultation with major shareholders, the Board of Aberdeen Frontier Markets Investment Company Limited (the “Company”) is pleased to announce that it intends to commence making half yearly distributions by way of a dividend. It is currently anticipated that a maiden dividend will be declared in respect of the six month period ending 30 June 2016 together with the full year results.
The Board expects to base the level of dividend on the Investment Manager’s calculation of the yield on the underlying portfolio (irrespective of whether or not that income is actually distributed up to the Company) less relevant costs. For the current full financial year this would have resulted in a dividend yield in respect of a full year of approximately 3%. Historically, the yield on the underlying portfolio has been broadly in line with that of the various frontier market indices. The Board is also mindful of the need to adopt a progressive dividend policy in absolute US dollar terms.
This measure is being adopted in the belief that the cash generative nature of many frontier companies, and the dividends into which this often translates, is an important part of the rationale for investing in the frontier market asset class. Consultation with existing and prospective shareholders on this topic has been supportive of this view. The Board also believes that the payment of regular dividends in this way will enhance the marketability of the Company.
The projected dividend set out above is an intention only and does not comprise a profit forecast. There can be no assurance that this intention can or will be met and it should not be seen as an indication of the Company’s expected or actual results or returns. Accordingly, investors should not place any reliance on this intention in deciding whether to invest in or acquire shares in the Company nor assume that the Company will make any distributions at all.
The declaration and/or payment of any dividend will be subject to compliance with all necessary regulatory obligations of the Company, including the Guernsey Law solvency test and will also be subject to the Company retaining sufficient cash for its working capital requirements.
AFMC : Aberdeen Frontier to pay dividends