Announcement of new dividend policy

In April 2006, Tesco announced a new dividend policy “increasing its dividend pay-outs broadly in line with its earnings growth rate”.

Tesco PLC Final Results - Part 1
Released: 25/04/2006
RNS Number:9255B
Tesco PLC
25 April 2006

Year ended 25 February 2006*

. . .

HIGHLIGHTS (on a 52-week basis)

  • 13.2% increase in group sales
  • 16.9% increase in new underlying profit
  • 14.1% increase in new underlying diluted earnings per share
  • 14.2% increase in full year dividend - in future also to rise in line with earnings

. . . .

The Board has proposed a final dividend of 6.10p per share (last year 5.27p). This represents an increase of 15.7% and brings the full year dividend per share to 8.63p, up 14.2% on last year. We have now built dividend cover to comfortable levels and this increase in the full year dividend is in line with 52-week earnings per share growth.

We also intend to grow future dividends
broadly in line with underlying diluted earnings per share growth going forward, instead of building dividend cover, which has been our dividend policy for the last three years.

The above mentioned announcement is an abridged version of the full announcement which can be found HERE

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