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Back on the dividend list: over 90 companies have restored payout after pandemic panic


There was more good news for London’s income investors this week, following on from more than 40 companies that have restored their dividend so far in the fourth quarter after scrapping payments earlier in the year because of the coronavirus pandemic.

Today we have seen Vistry Group PLC (LON:VTY), the FTSE 250 housebuilder, say it is mulling a return to the dividend list this year after a stronger than expected cash performance, and another construction group that cut its dividend earlier in the year, Balfour Beatty plc (LON:BBY), went one better saying it will pay a final dividend and as a first step is planning a £50mln share buyback.

Elsewhere, another back on the list was PEEK polymer specialist Victrex plc (LON:VCT), which confirmed it will resume its payouts despite a fairly hefty fall in profit and continued uncertainty.

Earlier in the week, identity data intelligence specialist GB Group PLC (LON:GBG) also got back on the horse with a half-year dividend after scrapping its final payment back in April, and last week low-price housebuilder MJ Gleeson PLC (LON:GLE) also rejoined the coupon club.

Between early July, when the first dividend cutter started to regain confidence and begin restoring payouts, and up to the end of November, 88 companies have rehabilitated their dividends or pledged to restart pay-outs, according to research from AJ Bell, with the returners in the early days of December taking this into the nineties

Together this is returning close to £4bn of income in total to investors after scrapping or pausing payments earlier in the year due to COVID-19.

Last month 31 companies climbed back on the dividend wagon, with £602mln of aggregate payouts confirmed, with Crest Nicholson, Forterra, New River REIT, TI Fluid Systems, Vitec and Watkins Jones still to confirm amounts.

This followed 11 in October that added £133mln, with BT and Rentokil pledging a return by not yet confirming the amount.

Among the near-430 companies that have kept their dividend in place this year, according to AJ Bell, Tesco PLC’s (LON:TSCO) special dividend is worth mentioning this week, as the grocery giant confirmed the timing of its bumper £5bn payout will be in just over two months’ time, and on Monday, another 2020 stalwart Games Workshop Group PLC (LON:GAW) also said this week that it will pay a dividend of 60p per share of surplus cash next month.

While the abovementioned Victrex returned to paying a dividend it cut its payment compared to last year.

So far since March 2020, there have been 603 dividend cutters, lopping off £47.4bn of income, AJ Bell said, including more than half of companies in the FTSE 100, led by giant cuts from Shell, HSBC, BP and Glencore.

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