In a significant financial development, the Treasury is set to receive a notable dividend boost of Sh7.7 billion, courtesy of Safaricom's announcement of an interim dividend payout of Sh0.55 per share.

This announcement follows the telecommunications giant's declaration of a Sh23 billion interim payout, scheduled for distribution on March 31 to shareholders registered as of March 15.

With the government holding a 35 percent stake in Safaricom, equivalent to 14.02 billion shares, and multinational entities Vodacom Group Limited and Vodafone Group Plc jointly owning a 40 percent stake, amounting to 16 billion Safaricom shares, the dividend allocation promises significant financial gains for the Treasury.

Vodacom Group Limited and Vodafone Group Plc are anticipated to earn Sh8.8 billion in interim dividends from their stake.

Retail investors, numbering 533,172 as of December 2023, are also poised to benefit, with a collective share of Sh648.6 million in dividends.

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Despite their substantial presence, these investors collectively hold only 2.9 per cent or 1.18 billion shares of the company.

Safaricom's decision to introduce interim dividends since February 2021 aligns with the Central Bank's directive aimed at mitigating pressure on the forex market by reducing the necessity for bulk dollar sourcing to pay foreign investors.

This strategy marks a departure from the previous practice of distributing cash dividends once, typically in August or September, in the form of a first and final dividend.

The interim dividend payout has experienced fluctuations over recent years.

Starting at Sh0.45 per share for the financial year ending March 2021, it reached its peak at Sh0.64 in 2022 before decreasing to Sh0.58 in 2023 and further to Sh0.55 in the current reporting period.

The recent adjustment in interim dividends follows Safaricom's consolidated net profit for the half-year ended September 2023, which experienced a 10 percent decline to Sh27.1 billion.

The decline is primarily attributed to increased costs in its Ethiopian operations, while net earnings from the Kenyan business witnessed a 13.6 percent surge to Sh40.6 billion.

Despite the adjustment in dividends, Safaricom's share price remained stable at Sh13.40 during Thursday's stock market trading.

The telco led trading activities, accounting for 68.7 percent of the Nairobi Securities Exchange's total traded turnover of Sh371.7 million, with Safaricom's