Friday Email: 08 March 2013

It has been an interesting week in which the insurers showed contrasting fortunes. After RSA last week Aviva followed suit by slashing its final dividend. In contrast, Standard Life increased its final dividend and could afford to pay a special dividend, resulting in a 22.6p return on the 3rd April. Admiral and Legal & General both increased their final dividends by 20%. I am certainly glad that I chose Legal & General for my dividend of the week on January 30th, although Aviva was tempting as it did have the higher (on the face of it) prospective yield. In the end I made the right choice.

Elsehwere, we have had a storming week on the dividend front with 10 companies increasing their dividend by 20% or more. The list is; Unite (240%), SIG (33%), Hunting (23.3%), Admiral (20%), Legal & General (20%), John Wood Group (26%), Serco (20%), Pace (20%), Moneysupermarket.com (30%) and Intertek (22%).

In addition, it was a good week for special dividends, in fact so far it has been a good year for special dividends with Standard Life and Spirax-sarco adding to previously declared 'specials' from ITV, Lancashire holdings, Fidessa and Hiscox. Admiral also declare a special, but given that it occurs every year, we treat it as a normal dividend. Aggreko also managed a 15% increase in its dividend which we like, but the situation there was puzzling as they has practically issued a profit warning a few months back. Now they effectively reversed it and the share price clawed back all that it lost rising almost 14% on the day.

After a very busy week that saw about 50 companies that we follow in the U.K. reporting, Friday is very quiet on the corporate front!