Kety’s management has announced that it will propose a PLN 4 per share dividend payment, constituting a 42% payout from 2005 net income. The payout is consistent with Kety’s strategy of paying out between 40-50% of net income as dividends. The per share dividend value is slightly lower than the PLN 4.3 per share, which we had expected. However, as the dividend payout was in line with market’s expectations, the news did not have a substantial impact on Kety’s share price on Friday.
Separately, proposed by the management, a new option programme was not accepted by the supervisory board and will be modified. The programme proposal assumed an issue of bonds for 40 key employees that would give the right to subscribe for a maximum of 444k new shares in 2010-2012 at the average price from 1Q06. The next supervisory board meeting is scheduled for the end of April.
We reiterate our Sell rating with a fair value of PLN 116.8 per share.