Renault board to consider dropping dividend to preserve cash due to coronavirus

Renault's planned dividend had already been cut by two thirds from the 3.55 euro per share pay-out on 2018 earnings as the firm's profitability had dr
...
File photo (AFP)
File photo

French car maker Renault's board will meet on Thursday to decide on possibly dropping the dividend payment this year in light of the coronavirus crisis, three sources familiar with the situation have told Reuters.

A Renault spokesperson was not immediately available for comment.

While several automotive companies such as Michelin and Ford have already decided to reduce or suspend dividends on 2019 earnings in order to preserve cash, Renault so far has not said whether it may do the same. It had earlier proposed to pay a 1.1 euro per share dividend.

Also check these Vehicles

Find more Cars
Renault Duster 2025 (HT Auto photo)
UPCOMING
Engine Icon1499 cc FuelType IconPetrol
₹ 10 Lakhs
Alert Me When Launched
Renault Kwid (HT Auto photo)
Engine Icon999 cc FuelType IconPetrol
₹ 4.70 - 6.45 Lakhs
Compare
View Offers
Renault Kardian (HT Auto photo)
UPCOMING
Engine Icon1199 cc FuelType IconPetrol
₹ 11 Lakhs
Alert Me When Launched
Renault Kiger (HT Auto photo)
Engine Icon999.0 cc FuelType IconPetrol
₹ 6.50 - 11.23 Lakhs
Compare
View Offers
Renault Triber (HT Auto photo)
Engine Icon999.0 cc FuelType IconPetrol
₹ 6.33 - 8.97 Lakhs
Compare
View Offers
Renault City K-ze (HT Auto photo)
UPCOMING
BatteryCapacity Icon26.8kWh Range Icon271 Km
₹ 6 - 10 Lakhs
Alert Me When Launched

Shareholders will vote on the issue at a delayed meeting that will probably take place in May or June.

Also Read : Volkswagen’s record $3.6 billion dividend is under review due to coronavirus

The planned dividend had already been cut by two thirds from the 3.55 euro per share pay-out on 2018 earnings as the firm's profitability had dropped in 2019, well before the coronavirus outbreak.

But the French government is asking companies in which it is a shareholder to go further than that and pay no dividend at all, especially if they are receiving state aid to get through the crisis, such as temporary unemployment.

Several board members who represent staff have already called on Renault, which is 15% state-owned, to scrap the dividend.

Also Read : Nissan shareholders to choose new directors as business plummets

Workers at all Renault's French factories are receiving unemployment benefits, which helps the company to keep them on the books. Another 16,000 white-collar Renault workers in the Paris region are also using temporary unemployment for half of their working day.

Renault, which is implementing a restructuring plan that involves asset sales and an exit from its least profitable markets, may also announce that its management may take a pay cut this year, one of the sources said.

Already shaken by charges against its former chief Carlos Ghosn and forced to halt production on its main markets, the firm's shares have fallen 56 % since the start of the year.


First Published Date: 09 Apr 2020, 10:25 AM IST
NEXT ARTICLE BEGINS

Check Latest Offers

Please provide your details to get Personalized Offers

Choose city
+91 | Choose city
Choose city
Select a dealer

Want to get the best price for your existing car?

Powered by: Spinny Logo
By clicking "View Offers" you Agree to our Terms and Privacy Policy
Dear Name

Please verify your mobile number.

+91 | Choose city
Couldn't verify the OTP.
It's either expired or it's incorrect.