Romanian construction materials producer TeraPlast (TRP) will distribute special dividends worth RON 226.6 mln (EUR 46.5 mln) from its net profit for the first quarter of 2021 (Q1 2021). The gross dividend per share is RON 0.13, and the yield is 24%, based on the share price before the announcement - RON 0.548.

The company's shares jumped 18% after the announcement, to RON 0.65, after which it gradually declined towards RON 0.6.

In addition to the cash distribution, TeraPlast also plans to increase its share capital by RON 43.6 mln (EUR 8.9 mln) by capitalizing some of its reserves. It will distribute one free share for every four shares held by its shareholders at the registration date.

The company will hold a general shareholders' meeting (GSM) on June 25 to discuss these proposals. The registration date for the special dividends will be July 13, and the registration date for the capital increase will be September 29.

On February 27, TeraPlast cashed in RON 373 mln (EUR 76.6 mln) from its Steel division's sale to Irish group Kingspan. The group's management wants to keep RON 147 mln (EUR 30 mln) for new acquisitions or for a new special dividend towards the end of the year. TeraPlast has initiated investments of over RON 160 mln (EUR 32.8 mln) this year and is actively looking for new takeover opportunities, the group said in a note to investors. Three of the new investments are co-financed with state grants.

TeraPlast plans to continue its regional expansion and increase its market share through M&A. "Our interest is for companies that allow us synergies. We are looking at several criteria. First, the field of activity has to be similar or complementary to the ones TeraPlast Group activates on: recycling, flexible packaging, pipes and related products for water, gas and sewerage networks. Second, they must manufacture products with export demand, or which can dislodge imports from the domestic market. On the other hand, they must be companies that have high-performance production technologies. Financial performance is another key criterion. We are looking to companies that have similar indicators to those of TeraPlast and a low degree of indebtedness. These are cumulative conditions," stated Dorel Goia, Chairman of TeraPlast's Board of Directors. He is also the group's biggest shareholder, with a 46.8% stake.

TeraPlast currently has a market capitalization of RON 1.1 bln (EUR 225 mln), after its shares went up by more than 150% in the last year.

editor@romania-insider.com

(Photo source: the company)