Business Context and Reporting Period
Company: AMÉRICA MÓVIL, S.A.B. DE C.V. (AMX)
Filing Type: Form 6-K (Report of a Foreign Private Issuer)
Date: October 31, 2016
Subject: Notice of Cash/Stock Dividend and Change in Capital Stock. The filing details a dividend distribution approved at the shareholders' meeting on October 6, 2016, payable from net earnings accrued prior to December 31, 2013.
Key Financial Metrics
Dividend Amount: Ps.0.14 (fourteen cents of one Mexican peso) per Series AA, Series A, and Series L share.
Outstanding Shares: 65,458,462,516 shares as of October 28, 2016.
Treasury Shares Available: 30,030,622,754 Series L shares held by the Company, available for distribution as stock dividends.
Maximum Potential Distribution: Up to 820,428,357 Series L shares (assuming 100% election for stock and a reference price of Ps.11.17).
Revenue, Profit, and Cash Flow: The filing text does not provide current period revenue, profit, cash flow, margins, debt, or liquidity metrics. This document is a corporate action notice, not a financial results report.
Material Changes and Share Structure
- Share Composition (as of Oct 28, 2016):
- Series A: 596,200,654 (0.91%)
- Series AA: 20,634,632,660 (31.52%)
- Series L: 44,228,129,202 (67.57%)
- Capital Stock: The placement of Series L shares into circulation will not increase the Company's authorized capital.
- Dilution: Shareholders electing cash dividends may experience dilution due to the release of additional Series L shares to other shareholders.
Guidance, Outlook, and Terms
Dividend Election Options: Shareholders may elect to receive the dividend in (i) cash, (ii) Series L shares (treasury shares), or (iii) a combination thereof.
Key Dates:
- Record Date: November 8, 2016
- Election Period: November 9, 2016 to 3:30 p.m. on November 11, 2016
- Payment Date: November 14, 2016
Default Option: Shareholders failing to submit an election notice by the deadline will receive the dividend in cash only.
Tax Implications:
- Mexico: Dividends from earnings accrued prior to 2014 are exempt from Mexican withholding tax. Reinvestment in Series L shares is deemed an automatic reinvestment, not a taxable event at distribution.
- U.S.: U.S. holders generally recognize taxable dividend income equal to the gross amount received (cash or fair market value of shares). The dividend is not eligible for the dividends-received deduction for corporations.
Risks and Contingencies: The filing contains forward-looking statements regarding the number of shares to be delivered, which depend on shareholder elections and market prices. Actual results may differ significantly from estimates.
Investor Verification Checklist
- Verify the specific election deadline (November 11, 2016, 3:30 p.m.) to avoid defaulting to cash-only payment.
- Confirm the "Reference Price" (market price of Series L shares at opening on the Payment Date) to calculate the exact number of shares received if electing stock.
- Review custodian-specific procedures for submitting the "Notice of Election," as instructions vary for ADS holders versus direct share holders.
- Assess potential dilution impact if electing cash while other shareholders elect stock.
- Consult tax advisors regarding U.S. federal income tax consequences, specifically the treatment of foreign currency conversion and backup withholding.