Tesco Plc announces a final dividend 6.50p, representing a pay-out ratio of 50%

DividendMax Ltd.

Tesco Plc announces a final dividend 6.50p, representing a pay-out ratio of 50%

The proposed Tesco final dividend was approved by the Board of Directors on 7 April 2020 and is subject to the approval of shareholders at this year's Annual General Meeting.  The final dividend will be paid on 3 July 2020 to shareholders who are on the register of members at close of business on 22 May 2020 (the Record Date).  Shareholders may elect to reinvest their dividend in the Dividend Reinvestment Plan (DRIP).  The last date for receipt of DRIP elections and revocations will be 12 June 2020.

Other financial highlights include:

Shopping trip satisfaction improved across all formats; brand net promoter score +7 points year-on-year

Brand perception further improved across range, quality and value9

'Aldi Price Match' launched in March across hundreds of Tesco and branded products

Cash profitability

Retail operating profit before exceptional items and amortisation of acquired intangibles10 of £2,766m, +14.9%, margin 4.4%;

- Strong performance in UK & ROI and Asia, partly offset by disruption impact of transformation in Central Europe

- UK & ROI £2,184m, +16.9%, margin 4.2% 

- Central Europe £156m, (29.4)%, margin 2.8% 

- Asia £426m, +33.5%, margin 8.2%

Bank operating profit before exceptional items £193m, (3.0)%

Cumulative Booker synergies £207m, delivered a year ahead of target; acquisition of Best Food Logistics in early March

Group operating margin of 4.64% (+56bps); Retail EBITDA10 up 8.8% to £4.7bn

Cash flow

Retail free cash flow of £2,063m, including CE property disposals of £167m and £277m from sale of China joint venture, reflecting strength of last year's performance and a robust liquidity and balance sheet; full-year dividend of 9.15p 

Net debt5 of £(12.1)bn, down £1.1bn year-on-year

Proposed sale of businesses in Thailand and Malaysia

Consideration of $10.6bn (c.£8.2bn) on a cash and debt free basis, conditional on shareholder and regulatory approval

Plan to return c.£5bn to shareholders via a special dividend; £2.5bn one-off pension contribution to eliminate funding deficit

Completion of sale expected 2H 2020; Thailand and Malaysia to be treated as discontinued for 2020/21 financial year

Companies mentioned