I read that bonds have semi-annual rates, what does that mean?

As per what Gabriel stated, payouts will be on a half-yearly basis, at 2.5% with his same example. When people make comparison against bonds with different payout structures(semi-annually or annually), they like to assume the bond payout can be reinvested at the same interest rates. Therefore people would use the metric Effective Interest Rates(EAR) to compare bond yields. A half yearly 2.5% payout would have a EAR of 5.0625% whereas a full year 5% payout's EAR is simply 5%.

It means they payout twice a year.

Example if the bond pays out 5% per year, then each payout semi-annually will be 2.5%.