Dividends ‘to rise by 5pc this yr and 9pc next’

Shareholders can assume greater payments from organizations like Lloyds Banking Group, main survey suggests


Shareholders can expect virtually 5pc greater dividend payments this year, authoritative study suggests.

Dividends from Britain’s 350 largest listed businesses will total £74.5bn in 2014, a rise of 4.7pc, according to Markit, the information firm. Next 12 months the enhance will be much steeper, with a 9pc rise, the organization predicted.

The figures exclude exceptional dividends, this kind of as a giant payment to Vodafone shareholders.

The prime five dividend payers all have “projected yields” – individuals primarily based on Markit’s predicted dividend payments – of a lot more than 4.5pc. GlaxoSmithKline would yield 5.2pc at present share rates, primarily based on an expected five.1pc rise in its yearly dividend, although HSBC was expected to enhance its payment by two.3pc to yield 5.2pc. Markit predicted a dividend lower of 2.7pc at Shell, taking the yield to 4.7pc, even though BP would yield the very same figure following an anticipated .9pc rise in its payment.

Vodafone’s payment was predicted to fall by sixteen.1pc, soon after which it would yield a nevertheless healthier 6pc.

Among the biggest expected adjustments to dividend payments had been a new payout from Lloyds Banking Group that would imply a yield of one.9pc at the existing share cost and a 400pc rise at Redrow, the home builder, taking its yield to 2.7pc. Foxtons, the estate agency, was expected to boost its dividend by 235pc to yield 3.5pc and Fresnillo, the miner, to pay out 216pc far more and yield one.2pc.

But Antofagasta, an additional miner, will cuts its payout by practically 70pc and yield 2.3pc, Markit predicted. Final year’s payment included a “important one particular-off return of capital”.

Across the index of the prime 350 firms as a whole, the firm predicted a yield of 4.2pc.

It stated a robust pound would have a damaging influence on some dividend payers, particularly in the oil &amp fuel and mining sectors. Huge merchants had been also at risk of cutting payouts, although the most significant increases had been expected from banking institutions and house builders.