Koninklijke Philips - EGM 26 June 2020
ECGS notes that as a result of the Covid-19 pandemic the EGM will be held as an
electronic meeting only. Consequently, it will not be possible to attend the EGM in
person.
In general, Koninklijke Philips ("Philips") is in compliance with the Dutch regulations
relating to the organisation and procedures of the Extraordinary General Meeting.
Under ITEM 1 the supervisory board proposes to distribute a dividend of EUR 0.85 per
share for the FY 2019 to be distributed as stock (scrip) dividend. ECGS notes that the
proposal to adopt a stock (scrip) dividend only, follows from the withdrawal, as
announced on April 20, 2020, of the earlier proposal to distribute an optional dividend (in
cash or shares) from the agenda for the 2020 AGM.
ECGS furthermore notes that an unchanged dividend of EUR 0.85 per share is proposed
to be paid for the FY 2019. In ECGS¶view, the proposed stock (scrip) dividend that
replaces the prior optional (cash or stock) dividend is adequately justified in view of the
Covid-19 pandemic. To the best of ECGS'knowledge the proposed stock (scrip) dividend
is NOT issued at any discount.
Although the proposed dividend is covered by EPS, FCF as well as in accordance with
the Company's dividend policy (see above), ECGS would be in favour of postponing
decisions on the dividend, reductions or suspensions that would allow companies to
avoid liquidity risks or not generate risk for their survival. Thus, even though it does not
have an unfavourable opinion on the present dividend proposals (specifically as it is
proposed to be distributed as stock dividend, which does not result in any cash outflow),
ECGS will not have a negative opinion if the company changes the amount distributed to
shareholders either. Based on the above, ECGS recommends to vote FOR.
Koninklijke Philips Electronics is active in the markets of healthcare, consumer lifestyle and lighting. Co.'s activities can be divided into three segments: Healthcare (Co. provides Imaging Systems, Patient Care and Clinical Informatics, Home Healthcare Solutions and Customer Services), Consumer Lifestyle (Co.'s products are divided into the following: Health and Wellness; Domestic Appliances; and Lifestyle Entertainment), Lighting (Co. provides lighting solutions for homes, shops, offices, schools, hotels, factories and hospitals; Co. also offers solutions for roads (street lighting and car lights) and for public spaces, residential areas and sports arenas).
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