The Board of AU Optronics Corp. approves to the following shareholder return policy for 2022-2024 and resolves to conduct capital reductions
AU Optronics Corp. (“AUO”) (Stock Code: 2409) has devoted itself to a value transformation strategy these past few years and as a result has achieved market-leading positions by developing advanced display technology and launching high-end products. Various applications in smart fields have been developed as well. The strategy of "Biaxial Transformation" has been gradual but effective. As a result, AUO has confidence that it can reduce the influence of industry cyclicality and generate more stable operating cash flow. Thus, AUO commits to delivering stable and clear 3-year shareholder return to enhance long-term shareholder equity and corporate values.
AUO plans to distribute not less than NT$55.77 billion as shareholder return from 2022 to 2024. The total amount distributed in 2022 will be NT$28.82 billion, and the rest of the shareholder return will be allocated in 2023 and 2024. Shareholder return includes dividends, capital reduction and return of capital reserve and may be executed separately or collaboratively via cash distribution. The actual allocation and amount1 of shareholder return in each year will be subject to approval from the Board of Directors or Shareholders’ Meeting in accordance with the applicable laws and company bylaw.
The shareholder return NT$28.82 billion2 in 2022 will be distributed via cash dividends and capital reductions. If converted into a per-share basis, it will be NT$3 per share, including cash dividends of NT$1 per share and capital reductions of NT$2 per share. Capital reduction is expected to occur after the dividend distribution. Shareholder return this year is partially distributed via capital reduction to reduce the tax burden for shareholders and adjust the Company’s capital structure to correspond with value transformation. The payout ratio will be 46.6% based on the EPS of NT$6.44 in 2021.
If the shareholder return in 2023 and 2024 is NT26.95 billion and calculated on the total number of shares issued after the capital reduction in 2022, cash distributed per share will be expected to be NT$3. 53.
AUO’s revenues and net profit in 2021 were record high in recent years. Net profit attributable to owners of the Company was NT$ 61.33 billion, net cash from operating activities was NT$104.7 billion, retained earnings were NT$ 80.67 billion, capital surplus was NT$ 60.06 billion and net debt to equity ratio was -10%. Overall, the financial health of the Company is sound. Therefore, the 3-year shareholder return policy will not affect future investment plans and cash needed for operations.
The total amount of capital reduction in 2022 will be NT$ 19,248,490,230, which translates to 1,924,849,023 cancelled shares. Based on AUO’s current total number of shares issued of 9,624,245,115, the capital reduction percentage is 20%. Share capital will be NT$76,993,960,920 after the capital reduction. After the approval of this capital reduction from the shareholders’ meeting and the relevant authorities, the Chairman will be authorized to determine the record dates of the capital reduction and replacement of shares.
1 The actual amount of shareholder return per share will be calculated on the total amount of shareholder return for each distribution and number of shares eligible to participate; Dividends and return of capital reserve will be distributed by number of outstanding shares; Capital reduction will be calculated in accordance with total shares issued.
2 Total amount of distribution in 2022 includes the cash dividends of NT$9.58 billion from 2021 distributable earnings and capital reduction of NT$19.25 billion.
3 The shareholder return to be distributed in 2023 and 2024 per share is calculated on the distribution of NT$26.95 billion divided by the number of shares issued (7.699 billion) after capital reduction.