Smart Share Global Limited Declares a Special Cash Dividend

Rhea-AI Summary

Smart Share Global Limited (EM) announces a special cash dividend of US$0.015 per ordinary share, or US$0.03 per ADS, totaling approximately US$8 million, to be paid to shareholders on June 7, 2024. The dividend will be funded by the company's surplus cash of RMB3.3 billion as of September 30, 2023.

Insights

Financial Analyst

The declaration of a special cash dividend by Smart Share Global Limited represents a significant return of capital to shareholders and is indicative of the company's strong liquidity position. With a robust cash reserve of approximately RMB3.3 billion as of September 30, 2023, the company appears to be well-capitalized and able to afford this distribution without impairing its operational capabilities. The total dividend payout of approximately US$8 million is a substantial figure, signaling confidence in the company's ongoing cash generation abilities.

Investors should note the dividend yield that this payment represents relative to the stock's price. While a one-time dividend may not have the same impact on the stock's attractiveness as a recurring dividend, it can still be seen as a positive signal regarding management's commitment to shareholder returns. However, analysts should also consider the opportunity cost of this payout, as the funds could alternatively be used for reinvestments into the company's growth initiatives or for strategic acquisitions.

Market Research Analyst

From a market perspective, the announcement of a special dividend often leads to a positive reaction in the company's stock price, as it can be interpreted as a sign of financial health and a shareholder-friendly capital allocation policy. However, the long-term effects on the stock price will largely depend on the company's future growth prospects and its ability to maintain a strong balance sheet post-dividend payment.

Given that Smart Share Global Limited operates within the consumer tech sector, providing mobile device charging services, it is essential to consider the competitive landscape and the demand for such services. If the sector is growing and the company maintains a competitive edge, the cash distribution might not deter future investments. Conversely, if the industry is facing headwinds or if there are significant capital expenditures required to stay competitive, the decision to pay out a substantial dividend could raise questions about the company's long-term strategic planning.

Economist

The payment of a special dividend can also be reflective of broader economic conditions. In a low-interest-rate environment, companies may opt to return cash to shareholders rather than holding excess cash or making low-yield investments. Conversely, in a high-interest-rate environment, holding onto cash or investing in higher-yielding assets could be more favorable, making such a dividend payment less common.

Additionally, the timing of the dividend, with the record date set for May 31, 2024 and payment dates in June 2024, may be strategically chosen to align with fiscal periods or anticipated economic shifts. It is important for investors to consider macroeconomic factors, such as inflation rates, currency exchange rates and economic growth projections, as these can influence the real value and impact of the cash returned to shareholders.

SHANGHAI, China, March 11, 2024 (GLOBE NEWSWIRE) -- Smart Share Global Limited (Nasdaq: EM) (“Energy Monster” or the “Company”), a consumer tech company providing mobile device charging service, today announced that its Board of Directors approved a special cash dividend of US$0.015 per ordinary share, or US$0.03 per American Depositary Share (“ADS”), to holders of ordinary shares and holders of ADSs of record as of the close of business on May 31, 2024, U.S. Eastern Time, payable in U.S. dollars. Dividend to be paid to the Company’s ADS holders through the depositary bank will be subject to the terms of the deposit agreement. The payment date is expected to be on or around June 7, 2024 for holders of ordinary shares and on or around June 14, 2024 for holders of ADSs.

The total amount of cash to be distributed for the dividend is expected to be approximately US$8 million, which will be funded by surplus cash on the Company’s balance sheet. As of September 30, 2023, the Company had approximately RMB3.3 billion in cash and cash equivalents, short-term investments and restricted cash.

About Smart Share Global Limited

Smart Share Global Limited (Nasdaq: EM), or Energy Monster, is a consumer tech company with the mission to energize everyday life. The Company is the largest provider of mobile device charging service in China with the number one market share. The Company provides mobile device charging service through its power banks, which are placed in POIs such as entertainment venues, restaurants, shopping centers, hotels, transportation hubs and public spaces. Users may access the service by scanning the QR codes on Energy Monster’s cabinets to release the power banks. As of September 30, 2023, the Company had 8.7 million power banks in 1,189,000 POIs across more than 2,000 counties and county-level districts in China.

Contact Us

Investor Relations
Hansen Shi
ir@enmonster.com

Safe Harbor Statement

This press release contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by words or phrases such as “may,” “will,” “expect,” “anticipate,” “target,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to,” or other similar expressions. The Company may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission (“SEC”), in its annual reports to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Energy Monster’s strategies; its future business development, financial condition and results of operations; the impact of technological advancements on the pricing of and demand for its services; competition in the mobile device charging service industry; Chinese governmental policies and regulations affecting the mobile device charging service industry; changes in its revenues, costs or expenditures; the risk that COVID-19 or other health risks in China or globally could adversely affect its operations or financial results; general economic and business conditions globally and in China and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any duty to update such information, except as required under applicable law.

FAQ

What dividend did Smart Share Global Limited (EM) announce?

Smart Share Global Limited announced a special cash dividend of US$0.015 per ordinary share, or US$0.03 per ADS.

When will the dividend be paid to shareholders?

The dividend is expected to be paid on or around June 7, 2024, for holders of ordinary shares and on or around June 14, 2024, for holders of ADSs.

How much cash will be distributed for the dividend?

The total amount of cash to be distributed for the dividend is expected to be approximately US$8 million.

What will fund the dividend payment?

The dividend will be funded by surplus cash on the company's balance sheet, which was approximately RMB3.3 billion as of September 30, 2023.