This is like what we see in some Chinese drama.
“I have good news and bad news. Which one do you want to hear first?”
Yes, I know!
Bad AK! Bad AK!
As usual, I just zoom in on what matters to me.
Regular readers know that AK is too lazy to do complete analyses.
In my defense, I would say that it is like putting together a jigsaw puzzle.
We do not need to have every single piece to be in place to see the picture.
We just need to put the most vital pieces of the puzzle together.
In the case of Wilmar, I mostly focus on their operating cash flows and the capital expenditure or CAPEX.
Wilmar is still growing its businesses.
Yes, in the plural.
They have many businesses which are growing and they are constantly investing in them.
So, if they have strong operating cash flow but use all the cash in CAPEX, there would be nothing left to pay dividends.
See why I look at operating cash flow and CAPEX now?
As a retiree investor for income, dividends are vital to me.
In 1H2023, Wilmar generated US$3.19 billion in operating cash flow while CAPEX was US$1.16 billion.
They also used US$142.2 million for the acquisition of subsidiaries, joint ventures and associates.
So, if we do the sums, Wilmar could easily pay a dividend even though its profit reduced 10%.
6c DPS amounts to US$542.6 million.
After all this, Wilmar is still free cash flow positive!
Any investor would love to see this.
As Wilmar is one of my largest investments, I am looking forward to the dividend which would be paid on 30 August.
If you are curious how much my 3Q 2023 passive income is going to be, you are not alone?
If AK can do it, so can you!
P.S. A new YouTube video I produced today will go LIVE at 7pm this evening.
You can go to my YouTube channel and set a reminder under “Notify Me” if you would like to watch the video together with me.