العربية

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stc
Annual Report
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A brief overview of stc
Group

 

,The performance, activities

and investments of stc Group

and its subsidiaries during

the year 2022

 

Risks management

and transactions with

related parties

 

Board of Directors and
Committees

 

Dividends Policy and Distribution

and Board Recommendations and

Compensation

 

Conclusion

 

Financial Consolidated

Statements

A brief overview of stc Group The performance, activities, and
nvestments of stc Group and
its subsidiaries during the year 2022 Risks management and transactions
with related parties Board of Directors and Committees Dividends Policy and
Distribution and Board
Recommendations and Compensation Conclusion Financial Consolidated
Statements

stc’s Dividend

Distribution

Policy

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Article 45 of the stc’s Articles of Association provides for the distribution of the stc’s annual net profits as follows:

1

Ten percent (10%) of the annual net profits shall be set aside to form a statutory reserve. Such setting aside may be discontinued by the Ordinary General Assembly when said reserve totals thirty percent (30%) of stc’s paid-up capital.

2

The Ordinary General Assembly may, upon the request of the Board of Directors, set aside a specific percentage of the annual net profits to form a consensual reserve to be allocated for the purpose or purposes decided by the General Assembly.

3

Ordinary General Assembly may form other reserves to the extent that would serve stc's best interest or would ensure distributing constant profits, as much as possible, amongst Shareholders. Besides, the Ordinary General Assembly may allocate from the net profits amounts to establish social institutions for stc’s employees or to support existing social institutions.

4

Out of the balance of the profits, if any, there shall be paid to the Shareholders an initial payment of five percent (5%) of stc’s paid-up capital.

5

Subject to provisions in Article (21) hereof, and Article (76) of the Companies Law, the Ordinary General Assembly may allocate a portion of the remaining amount to be paid as compensation to the Board of Directors provided that entitlement of such remuneration shall be in proportion to number of sessions the member has attended.

6

The Ordinary General Assembly may, upon proposal from the Board of Directors, distribute the remaining balance (if any) among Shareholders in the form of an additional dividend.

stc may pay interim dividend to its Shareholders on a bi-annual or quarterly basis in accordance with the directives issued by the Competent Authority upon authorization issued by the Ordinary General Assembly to the Board of Directors to distribute such interim dividend.

Article 46 of stc’s Articles of Association stipulates that a shareholder shall be paid his dividend share subject to a resolution by the General Assembly, and such resolution shall state the date of maturity and distribution. Eligibility for dividends shall be for Shareholders registered in the Shareholders' Register at the end of the day specified for maturity. The dividends to be distributed amongst Shareholders shall be paid at the place, dates, and in the manners to be specified by the Board of Directors as per instructions issued by the Competent Authorities.

On 27 September 2021 the Board of Directors have approved stc’s dividends policy for the next three years starting from the fourth quarter of 2021, which was approved by the General Assembly held on 30 November 2021. The objective of the dividends policy is based on maintaining a minimum level of dividend of SAR 1 per share on a quarterly basis. stc will consider and pay additional dividend subject to the Board of Directors recommendation to the General Assembly after assessment and determination of stc's financial situation, outlook and capital expenditure requirements. It is probable that additional dividends are likely to vary on a quarterly basis depending on stc’s performance.

The dividends policy will remain subject to:

a.

Any material changes in the stc's strategy and business (including the commercial environment in which stc operates).

b.

Laws, regulations and legislation governing the sector in which stc operates.

c.

Any banking, other funding or credit rating covenants or commitments that stc may be bound to follow from time to time.

On 11 June 2022, the Board of Directors recommended to the General Assembly to amend the dividends policy to reflect the stc’s capital increase, which is:

The objective of the policy is based on maintaining a minimum dividend of SAR 0.40 per share on a quarterly basis, for the same period covered by the current policy. The Board's recommendation was approved by The Extraordinary General Assembly on 30 August 2022 stc will consider and pay additional dividend subject to the Board of Directors recommendation to the General Assembly after assessment and determination of stc's financial situation, outlook and capital expenditure requirements. It is probable that additional dividends are likely to vary on a quarterly basis depending on stc’s performance.