The Smiths Group Board maintains a progressive dividend policy, aiming to increase dividends in line with long-term underlying growth in earnings and cash-flow. The policy enables them to retain sufficient cash-flow to finance investment in the drivers of growth and meet financial obligations. In setting the level of dividend payments, the Board considers prevailing economic conditions and future investment plans, along with the objective to maintain minimum dividend cover* of around 2 times.
In March the Board considered it prudent not to declare an interim dividend for HY2020 until such time as trading conditions became clearer and there was less uncertainty. Reflecting the Group's strong performance and financial position, the Board is now recommending a total dividend of 35.0p per share for the year. This reflects a delayed interim dividend of 11.0p and a proposed final dividend of 24.0p.
Other financial highlights include:
Headline cash conversion at 123% (FY2019: 83%)
Net debt of £1.1bn (including leases) and EBITDA (Continuing and Discontinued) of £610m; a ratio of 1.7x (1.9x including restructuring and write-downs)
Cash of c.£390m and undrawn RCF of c.£610m; total liquidity headroom of £1bn