Distribution of Dividends corresponding to Fiscal Year 2023

Rhea-AI Summary

Ecopetrol S.A. shareholders approved a dividend distribution of COP $312 per share during the General Ordinary Shareholders' Meeting. The company is a major player in Colombia's energy sector, with significant operations domestically and internationally.

Insights

Financial Analyst

The announcement of Ecopetrol's dividend distribution represents a tangible return on investment for shareholders and can be a signal of the company's financial health. The decision to pay out an ordinary and an extraordinary dividend suggests a stable cash flow, which could be interpreted as a positive indicator of Ecopetrol's profitability and confidence in its financial stability. It is important to note that the dividend yield, calculated as the annual dividend per share divided by the stock price, can affect investor sentiment and stock performance.

Moreover, the structured payment schedule, with installments for minority shareholders and a separate timeline for the majority shareholder, reflects a strategic approach to cash management. This could be especially relevant considering the reference to the Fuel Price Stabilization Fund debt, implying that Ecopetrol is balancing shareholder returns with its financial obligations.

Energy Sector Analyst

Ecopetrol's role as a dominant player in Colombia's hydrocarbon sector and its diversified operations across the American continent, including energy transmission and road concessions, underline the importance of evaluating its performance within the broader energy market context. The dividend announcement may enhance investor confidence in the energy sector, particularly in the integrated oil and gas segment, where companies like Ecopetrol are expanding their portfolio to include non-traditional energy assets.

Investors should consider the potential impact of geopolitical factors and oil price volatility on Ecopetrol's future earnings and dividend sustainability. The company's strategic investments in infrastructure and exploration in various American basins are pivotal for long-term growth, which in turn could influence future dividend policies.

Market Research Analyst

The distribution of dividends by Ecopetrol could attract a certain investor demographic that prioritizes steady income, potentially increasing the demand for its shares. It is also reflective of the company's current market positioning and its ability to generate sufficient profits to support such payouts. The investment community often views regular and predictable dividends as a sign of a company's maturity and reliability.

However, it's important to monitor how these payouts affect the company's reinvestment capabilities and growth prospects. While dividends are beneficial for shareholders, a balance must be struck to ensure that sufficient capital is retained for future investments, R&D and to cushion against market downturns. The mention of the Fuel Price Stabilization Fund debt suggests that Ecopetrol is mindful of its financial commitments, which is a positive sign for cautious investors.

BOGOTA, Colombia, March 25, 2024 /PRNewswire/ -- Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC) informs that its shareholders, during the General Ordinary Shareholders' Meeting, held on March 22, 2024, approved the distribution of dividends as follows: an ordinary dividend of two hundred and seventy-eight pesos (COP $278) per share and an extraordinary dividend of thirty-four pesos (COP $34) per share, for a total dividend distribution of three hundred and twelve pesos (COP $312) per share. The payment of the ordinary and extraordinary dividend to minority shareholders will be made in two installments of equal value, on the following dates: April 3, 2024 and June 26, 2024. The payment to the majority shareholder will be made during the course of the year and in any case before December 31, 2024, taking into account the payment schedule of the balance of the debt of the Fuel Price Stabilization Fund (FEPC) accrued during 2023, which is owed by the majority shareholder to Ecopetrol. 

-----------------------------------------

Ecopetrol is the largest company in Colombia and one of the main integrated energy companies in the American continent  with more than 18,000 employees. In Colombia, it is responsible for more than 60% of the hydrocarbon production of most transportation, logistics, and hydrocarbon refining systems, and it holds leading positions in the petrochemicals and gas distribution segments. With the acquisition of 51.4% of ISA's shares, the company participates in energy transmission, the management of real-time systems (XM), and the Barranquilla - Cartagena coastal highway concession. At the international level, Ecopetrol has a stake in strategic basins in the American continent, with Drilling and Exploration operations in the United States (Permian basin and the Gulf of Mexico), Brazil, and Mexico, and, through ISA and its subsidiaries, Ecopetrol holds leading positions in the power transmission business in Brazil, Chile, Peru, and Bolivia, road concessions in Chile, and the telecommunications sector.

This press release contains forward-looking statements which are based on current expectations and assumptions about future events and which can be identified by the use of forward-looking terminology such as "may", "will", "should", "expect", "anticipate", "estimate", "intend", "continue", or "believe" or other words of similar import, and which forward-looking statements also include certain projections, forecasts, budgets and other estimates. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the Ecopetrol's control. Ecopetrol does not undertake any obligation to provide any additional information or to update this press release or to correct any inaccuracies that may become apparent, whether as a result of new information, future events or otherwise. You should not place undue reliance on forward-looking statements, which speak only as of the date of this press release.

For more information, please contact:

Head of Capital Markets
Carolina Tovar Aragón
Email: investors@ecopetrol.com.co 

Head of Corporate Communications (Colombia) 
Marcela Ulloa
Email: marcela.ulloa@ecopetrol.com.co

View original content to download multimedia:https://www.prnewswire.com/news-releases/distribution-of-dividends-corresponding-to-fiscal-year-2023-302098143.html

SOURCE Ecopetrol S.A.

FAQ

What dividend distribution was approved during Ecopetrol's General Ordinary Shareholders' Meeting?

Ecopetrol shareholders approved a dividend distribution of COP $312 per share, consisting of an ordinary dividend of COP $278 per share and an extraordinary dividend of COP $34 per share.

When will the payment of dividends be made to minority shareholders?

The payment of dividends to minority shareholders will be made in two installments of equal value on April 3, 2024, and June 26, 2024.

What is Ecopetrol's position in Colombia's energy sector?

Ecopetrol is the largest company in Colombia and accounts for over 60% of the country's hydrocarbon production. It is involved in transportation, logistics, refining, petrochemicals, and gas distribution.

In which countries does Ecopetrol have international operations?

Ecopetrol has operations in the United States (Permian basin and Gulf of Mexico), Brazil, and Mexico. Through its subsidiaries, it is also active in Brazil, Chile, Peru, and Bolivia in various sectors.