TIM S.A. announces R$650 million interest on equity payment

TIM S.A. (B3: TIMS3; NYSE: TIMB), a Brazilian telecommunications company with a "GREAT" financial health rating according to InvestingPro, has declared on Tuesday that it will disburse R$ 650 million as interest on shareholders' equity.

The company, which has maintained dividend payments for 14 consecutive years, currently offers a substantial 6.41% dividend yield. The company's board approved the distribution, which is slated for payment by January 23, 2025. Shareholders on record as of December 23, 2024, will be eligible for the payment, with shares purchased after this date not entitled to the interest payment.

The gross value per share stands at R$ 0.268528123, totaling the announced R$ 650 million. This distribution aligns with TIM's track record as a significant dividend payer, as highlighted by InvestingPro's analysis. However, this figure could change if the company decides to sell treasury shares for its Long-Term Incentive Plan. If any modifications occur, shareholders will be notified of the adjusted per-share amount.

A withholding income tax of 15% will be applied to the interest on equity, except for shareholders who are either exempt or subject to different tax treatments. Those shareholders must present their proof of exemption to Banco Bradesco S/A by December 23, 2024, to avoid the withholding.

Payments will be executed via book-entry shares through several methods. Shareholders with shares held in custody by CBLC will receive their payments through B3 S.A. - Brasil, Bolsa, Balcão, via their custody agents. Others may have the payment credited to a specified checking account at Banco Bradesco S/A, or collect it from Banco Bradesco S/A branches if they do not meet the conditions for the aforementioned methods.

For further details, shareholders can reach out to Banco Bradesco S/A branches or the provided email address. This announcement is based on the company's recent SEC filing. Currently trading near its 52-week low, InvestingPro's Fair Value analysis suggests TIM S.A. is undervalued, with 10+ additional ProTips available for subscribers looking to make informed investment decisions.

In other recent news, TIM S.A. has disclosed strong financial results for Q3 2024 during its earnings call, showing a 6.1% rise in service revenues and a 7.5% increase in EBITDA. The growth was driven by a 6.3% rise in mobile services and an 8% expansion of the post-paid customer base year-over-year.

Despite challenges in the prepaid segment and foreign exchange pressures, TIM S.A. remains on track to meet its year-end targets. The company has also announced strategic plans for mobile services and 5G deployment and intends to distribute BRL 3.5 billion in shareholder remuneration for 2024.

These recent developments also include a focus on enhancing the prepaid segment with innovative offerings and increasing recharge frequency, as well as expanding its digital ecosystem and B2B initiatives.

A new app and captive portal for prepaid users are set to launch at the start of 2024 to improve customer experience. Despite the challenges faced by the prepaid segment and intense competition in broadband services, TIM S.A. continues to demonstrate resilience and strategic acumen in navigating market challenges.

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