Seaspan to keep increasing dividends
Seaspan Corp, a Hong Kong-based shipper doubling its fleet, will increase its dividend to attract more investors.
'I cannot quantify eventually how much the dividend growth will be, but I can assure you there will be an increase,' chief executive officer Gerry Wang said in an interview last Thursday. 'We want to make sure the dividend increase is consistent over the years. We don't want a dividend increase one year at a high level, and another year at a lower level.'
The company will pay a higher dividend in 2009, Mr Wang said, without specifying when it will be announced. The company revealed dividend increases of 5 per cent in January of 2007 and 6.4 per cent in January of 2008.
Seaspan may boost its quarterly dividend 3.2 per cent to 49 cents a share in January, according to options monitored by Bloomberg.
Seaspan rose 59 US cents, or 2.6 per cent, to US$23.57 at 4.03pm in New York Stock Exchange composite trading. The shares have fallen 3.8 per cent this year, compared with a 45 per cent drop in the Baltic Dry Index, which measures spot prices for ocean shippers.
The company, which went public in 2005, has 32 ships with plans to more than double its fleet within the next three years. Some of the new vessels will carry as many as 13,000 containers, which would make them the largest in the world and four times bigger than average, Mr Wang said.
Seaspan has chartered ships to carriers including China Cosco Holdings Co, which last year agreed to lease eight for US$1.9 billion over 12 years.
Such contracts have enabled Seaspan to predict 29 per cent annual sales growth over the next five years, Mr Wang said. If the company signs new long-term contracts, earnings and dividends will increase, he said.
'If we continue to grow dividends consistently . . . I think over the long run, the investors will give us more value,' Mr Wang said.