Shineway Doubles Dividend Payout and Guarantees Compound Increase in Future Annual Dividend Based on Net Profit Growth

China Shineway Pharmaceutical Group Limited (stock code: 2877.HK) announced that it has adopted a new dividend policy that would bring impressive cash dividend return to its shareholders and becoming a "cash-cow of sustainable growth". The new dividend policy is summarized as followed:

1. Shineway expects to declare a dividend of HK$0.39 per share in the second half of calendar year 2021. Together with the 2020 final dividend of HK$0.21 per share distributed on 17 June 2021, shareholders will receive a total dividends of HK$0.60 per share in the calendar year of 2021. This amount is nearly a double of the 2020 dividend.

2. Starting from the calendar year of 2022, dividends would be compound increased by a guaranteed 15%. If the annual growth in net profit (without regard to one-time non-recurring profit and loss items) of the preceding year exceeded 15%, then the increase in dividends for that particular year will be based on the growth in net profit of the preceding year.
   
   Assuming a 25% net profit growth in each year, and a 1.2 exchange rate of RMB to HKD, dividends for the next three years can be depicted as follows:

• Dividends to be paid in 2021: RMB 0.60 / HK$ 0.72

• Dividends to be paid in 2022: RMB 0.75 / HK$ 0.90

• Dividends to be paid in 2023: RMB 0.94 / HK$ 1.13

• Dividends to be paid in 2024: RMB 1.18 / HK$ 1.42

3. From the calendar year of 2022 onwards, the dividends as declared by the Company shall be paid out to the shareholders of the Company four times a year at quarterly intervals in the form of interim dividends.

Shineway is confident that this new dividend policy which guarantees compound increase in future annual dividend based on net profit growth would attract long-term investors to invest in Shineway's shares.

For more details, please contact DLK Advisory by emailing to ir@dlkadvisory.com.