SKY Network Television Limited (NZSE:SKT) Goes Ex-Dividend Soon: A Deep Dive into the Company's Dividend History, Performance, and Future Prospects

As SKY Network Television Limited (NZSE:SKT) approaches its ex-dividend date on March 6, 2025, investors are eager to understand the company's dividend history, performance, and future prospects. In this article, we will delve into the key aspects of SKY Network Television's dividend story, providing valuable insights for investors considering the stock.

Dividend History and Yield

SKY Network Television has a history of paying dividends, with the annual dividend per share ranging from NZ$0.071 to NZ$0.1412 over the past two years. The current annual dividend of NZ$0.19 is the highest in this period, indicating an upward trend in dividend payments. The current dividend yield of 7.54% is higher than the historical average yield of approximately 4.7% to 7.2% over the past two years, suggesting that the current dividend yield is attractive compared to the company's historical performance.

In comparison to industry peers, SKY Network Television's current dividend yield of 7.54% is higher than the average yield of approximately 3% to 5% for companies in the Media industry. This indicates that SKY Network Television's dividend yield is more attractive than those of its peers in the industry.

Earnings Growth and Revenue Performance

SKY Network Television has been growing its earnings and revenue, which has contributed to its dividend payouts. In 2024, the company's revenue was 766.73 million, an increase of 1.64% compared to the previous year's 754.34 million. Earnings were 48.96 million, a decrease of -3.74%. Despite the slight decrease in earnings, the company has maintained its dividend payouts, with an annual dividend of 0.19 NZD per share, yielding 7.54%.

The company's earnings growth rate has been 74.8%, while the Media industry saw earnings growing at 32.1% annually. Revenues have been growing at an average rate of 0.8% per year. SKY Network Television's return on equity is 4.2%, and it has net margins of 2.4%.

Looking forward, the company expects to continue growing its earnings and revenue. The consensus EPS estimates fall by 37%, indicating that analysts expect the company's earnings to decline in the future. However, the company's dividend growth rate has been 28.12% over the past year, suggesting that the company is committed to maintaining and growing its dividend payouts.

Key Risks and Challenges

Despite the positive dividend history and performance, SKY Network Television faces several risks and challenges that could potentially impact its ability to maintain or increase its dividend payments. These include:

1. Profit margin trend: There is a new minor risk identified as a profit margin trend, which could indicate a decline in profitability, affecting the company's ability to sustain or grow its dividend payments.
2. Missed analyst expectations: SKY Network Television has missed analyst expectations for earnings in the past, which might suggest that the company's financial performance is not meeting expectations, impacting its dividend payments.
3. Share price stability: There is a new minor risk identified as share price stability, which could indicate a lack of investor confidence, affecting the company's ability to raise capital or maintain its dividend payments.
4. Dividend payout ratio: SKY Network Television's dividend payout ratio is high, at 155.40%, indicating that the company is paying out a significant portion of its earnings as dividends, which might not leave enough room for reinvestment or to maintain the dividend in the face of declining earnings.
5. Earnings growth: The company's earnings growth rate has been high in the past, but it is not clear whether this trend will continue, impacting the company's ability to maintain or increase its dividend payments.
6. Market conditions: As an entertainment company, SKY Network Television is subject to market conditions and consumer preferences, which could impact the company's financial performance and its ability to maintain or increase its dividend payments.

Conclusion

In conclusion, SKY Network Television Limited (NZSE:SKT) has a strong dividend history and performance, with an attractive current dividend yield compared to its historical average and industry peers. The company's earnings growth and revenue performance have contributed to its dividend payouts, and it expects to continue growing its earnings and revenue in the future. However, the company faces several risks and challenges that could impact its ability to maintain or increase its dividend payments. Investors should carefully consider these factors when evaluating SKY Network Television as a potential investment opportunity.