Global Testing proposes dividend of S$0.10 per share, capital reduction exercise

THE board of directors of Global Testing Corporation is proposing a dividend of S$0.10 per share.

It is also proposing a round of capital reduction and cash distribution, both at S$0.10 per share.

"The directors are of the view that the capital reduction is in the best interests of the company as the cash distribution comprises the issued and paid-up capital in excess of the immediate requirements of the company," the board wrote in a filing to the Singapore Exchange on Friday.

Global Testing offers testing services for the semiconductor manufacturing industry.

An extraordinary general meeting (EGM) will be convened to seek shareholders' approval for the dividend, and the capital reduction and cash distribution exercises.

The board has proposed a dividend of S$0.10 per ordinary share for the financial period ended March 31, 2016.

As for the capital reduction exercise, it is looking to reduce the issued and paid-up share capital of the company by S$3,535,802.70, or S$0.10 per share, to S$50,189,033.91. The number of issued shares is unchanged, said the company.

Net asset value (NAV) will thus be reduced from US$50,570 to US$47,939, resulting in a fall in NAV per share from US$1.43 to US$1.36. Return on equity will increase from 7.83 per cent to 8.26 per cent.

In turn, a cash distribution amount of S$3,535,802.70, or S$0.10 per ordinary share held as at the books closure date, has been proposed.

The distribution comprises the issued and paid-up capital in excess of the immediate requirements of the company, said the board.

Global Testing's counter was down 2.5 Singapore cents to close Friday at 92.5 Singapore cents.