Shareholder value creation is one of DIA´s top priorities. In 2015, the company boosted shareholder remuneration by increasing its dividend by 20% and reducing the number of shares outstanding by 4.16%.?In parallel, it continued to work to safeguard its shareholders´ rights by approving its Investor Communication Policy. In December, the DIA Group was admitted to the FTSE4Good sustainable investing index
Created in collaboration with UNICEF, the FTSE4Good index includes listed companies from all over the world that meet the prerequisites established by the London Stock Exchange Group: corporate social responsibility practices in relation to the environment, shareholder engagement and human rights, underpinned by responsible investing principles.
The index components are reviewed twice-yearly with a view to adding newcomers to the index and removing those that no longer meet its sustainability criteria.
At year-end, DIA had 622,456,513 shares outstanding, 71.78% of which were freely floated, 1.36% held as treasury shares with the remainder held by institutional investors with interests ranging between 1% and 10.2%.
In 2015, two investors, Cervinia Europe (Arnault Group) and Blue Partners (Colony), sold their combined 8.48% interest in DIA by means of an accelerated placement of 55.2 million shares with institutional investors. The shares were placed by Citigroup Global Markets Limited at a unit price of €7.4 so that the transaction size was €408.48 million.
Share price performance
The share price traded in a band defined by the low of €5.095 recorded in September and the high of €7.657 reached in April. During the first half of the year, the market applauded the positive results posted in the wake of the exit from the French market and the acquisition of the El Árbol supermarkets and Eroski stores in Spain, bidding the company’s share price higher. Subsequently, however, the share price suffered from food price uncertainty in Spain, currency devaluation in Brazil and Argentina and, above all, the global financial market rout during the final weeks of the year.
Growth in shareholder remuneration
DIA paid out a dividend of €0.18 per share (before withholdings) from 2014 profits on 16 July 2015, extending its track record of increasing shareholder remuneration year after year since its IPO in 2011. This dividend implied a payout (in terms of underlying net profit) of 43.9% and a dividend outlay of around €115 million.
For 2016, the Board of Directors will submit a motion to pay a dividend of €0.20 per share (before withholdings) from 2015 profits at the upcoming Annual General Meeting. This divided would imply year-on-year growth of 11.1% and represent a payout of 49%.
The company has earmarked over €800 million to shareholder remuneration since it went public in 2011
Complementing dividend policy and facilitated by its cash flow generation capabilities, on 10 September, the company reduced its share capital by €2.86 million by cancelling 28.6 million own shares (unit par value: €0.10), equivalent to 4.16% of the total outstanding. Following this transaction, DIA’s share capital stands at €62,245,651.
DIA strives to communicate openly, regularly and transparently with the investment community. In order to establish the criteria and actions governing relations with shareholders and investors and ensure compliance with the related aspects of prevailing corporate governance recommendations, the Board of Directors approved the group’s Investor Communication Policy in 2015.
Investor communication–guiding principles
The company’s official direct communication channel with its shareholders and the financial market in general is its corporate website (www.diacorporate.com), the content of which is updated continually. By means of this channel, the company monitors the information that may be of interest to its shareholders and other stakeholders. Generally speaking, the website facilitates immediate and user-friendly access to this information.
DIA’s website complies with the technical and legal stipulations laid down in the Circular issued by the Spanish securities market regulator, namely CNMV Circular 3/2015, of 23 June 2015.
The “Shareholders & Investors” tab includes structured and ordered information about the company’s share price performance, financial disclosures, fixed income securities, corporate governance and General Meeting documentation and an investor agenda. It also provides access to the Relevant Fact price-sensitive notices filed with the CNMV, the company’s press releases and details of how investors and analysts can contact the Investor Relations Department (firstname.lastname@example.org or by phone).
The Investor Relations Department, together with the CEO and the Executive Director responsible for the Finance Department, is responsible for communication with the analyst community and handling their queries.
In 2015, it organised more than 1,200 briefing events, including in-person meetings, webcasts and conference calls with analysts and investors. The aim of this intense activity is to make sure that proxy advisors have as comprehensive information about the company as possible when issuing their respective recommendations and reports.
Note that the 2015 Annual General Meeting was broadcast live by means of a webcast.
DIA’s transparency effort was explicitly rewarded by the financial community in 2015 when the company’s Investor Relations Department was selected by the prestigious publication Institutional Investors as the best team in the European Food sector for the second year in a row.