Best World International, on Oct 5, said that it had given $140 million back to its shareholders via two market equal access offers during its trading suspension period. The offers were completed in March 2022 and June 2022 and were extended to all shareholders.
Singapore Exchange Regulation (SGX RegCo) suspended the trading of Best World’s shares in May 2019. Best World then requested for the lifting of suspension and resumption of trading of its shares from Nov 14, 2022.
“[They] amount to a significant amount distributed to shareholders, enhancing total shareholder return,” says the company in its reply to queries from the Singapore Exchange S68 Securities Trading Limited (SGX-ST).
The SGX-ST said that it had received feedback with regard to the company’s dividends and remuneration policy and highlighted that no dividends were declared by the company despite the directors’ high remuneration level.
The company has not been paying dividends for the FY2022 ended Dec 31, 2022, 1QFY2023 and 1HFY2023 in a bid to “preserve cash to primarily support operating cash needs, expansion into new markets, investing in production capabilities” and other factors including setting up or refurbishing two to three regional centres a year, current mergers and acquisition (M&A) obligations and capitalising on potential acquisition opportunities.
“On grounds of prudence, the company preserves cash to address uncertainties that may arise, especially given the current high interest rate environment,” says Best World.
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Further to its statement, the board revealed that the company has paid out over $121 million in dividends from 2004 to 2019.
“When considering [the] declaration of dividends, the board takes into consideration both the short-term business outlook and the short to medium term working capital requirements of the group. The board also considers uncertain and potential events such as changes in business performance that may materialize in the short term,” it explains.
“With more than 50% of the group's FY2022 total revenue being derived from China, management is aware that the revenue contribution from China will continue to decline in the face of consumers' growing feeling of economic uncertainty ahead, and as such, consumers will be more careful than ever with their spending and are less likely to make the type of purchases we used to see in the pre-Covid years,” it adds.
Finally, the company clarified that for FY2022, over 90% of each executive director’s annual remuneration is in the form of a performance-based bonus referencing the audited group profit before tax of the immediate preceding financial year.
“The annual remuneration package for each of the executive directors has progressively been more performance-based, as the group increased its turnover and profitability over the years,” says the company.
Best World has also conducted share buybacks totalling about 8.5 million which came up to around $14.6 million since the lifting of its share trading suspension.
As at 10.32am, shares in Best World are trading 3 cents higher or 1.77% up at $1.73.
