(Business in Cameroon) – From January to November 2023, shares of the Société des Eaux Minérales du Cameroun (SEMC), part of the Castel Group, remained unchanged at CFA47,000 on the Central African Stock Exchange (BVMAC). This stability is largely due to a lack of buyer interest, as noted in BVMAC’s 2023 activity report.
In other words, while some shareholders wanted to sell their shares, few buyers were willing to make a purchase. Following a trade on December 19, 2023, the price of SEMC stock dropped by 2.23%, settling at CFA45,950, the lowest price of the year. SEMC concluded the last trading session of the year at this rate.
The limited interest from investors can be linked to the company’s lackluster performance since losing its leadership in the bottled water market in 2016. SEMC has faced strong competition from Source du Pays, which has made bottled water more affordable for consumers in Cameroon with its budget-friendly 10-liter packaging. Because of this, SEMC did not distribute any dividends to its shareholders between 2015 and 2022, a period of eight years. The company seemed more focused on regaining market share, despite ongoing losses and modest profits.
However, by the end of the fiscal year on December 31, 2023, SEMC announced it would finally return to dividend distribution. According to financial statements approved by the board, the company, which markets Tangui and Vitale bottled water (and Aquabelle in northern Cameroon), reported a net profit of CFA980 million for 2023, up from CFA504 million in 2022—an increase of over 94%. A total of CFA115.4 million in dividends was proposed for shareholders during the general meeting scheduled for June 5, 2024.
The financial statements also indicated that SEMC could have distributed more to shareholders. After accounting for losses of CFA151 million and allocating CFA82.9 million to the legal reserve, the board had the option to distribute CFA746.1 million. However, it chose to retain over CFA630.7 million in free reserves as a buffer for potential challenges or future investments.
