| Listing companies unwilling to offer dividends |
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| Friday,August 19,2005 Posted: 10:38 BJT(0238 GMT) Xinhuanet |
BEIJING, Aug. 18 (Xinhuanet) -- Of the 700-plus listed companies having published their half-year reports, only five Chinese companies plan to offer dividends to public shareholders, accounting for 0.7 percent, the Securities Daily reported on Thursday.
During the same period last year, a total of 54 companies listed in China's stock market gave dividends to public investors, accounting for 4.05 percent of the total listed companies, the newspaper said.
The newspaper owed the unwillingness to offer dividends to the forthcoming split share reform.
Following years of debate, China decided to end the split share structure, which is seen as the major problem in China's stagnant stock market. Split share structure refers to the existence of a large volume of non-tradable state-owned and legal personal shares.
According to the previous experience of pilot companies engaged in the reform, the listed companies need to provide shares or cash compensation to public shareholders so as to make all their shares tradable, so most companies are reserving funds for the future compensation plan.
Besides, the profits of some industries dropped in the first half year, making listed companies unable to provide dividends.
The profits of the chemical fiber industry, the transport equipment manufacturing industry, the construction material industry and the power industry decreased 43, 41.5, 21.9 and 6.1 percent, respectively, the newspaper reported.
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