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18th October 2018

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Strong Q3 growth pushes UK dividends within touching distance of £100bn for 2018 

Strong Q3 growth has pushed UK dividends within touching distance of £100bn for 2018, according to the latest UK Dividend Monitor from Link Asset Services.

According to the report, UK dividends rose 4.1% to £32.3bn in Q3, breaking a third-quarter record. Underlying payouts, which exclude special dividends, reached £31.6bn, a rise of 6.9% year-on-year.

For context, the UK Dividend Monitor is the only comprehensive analysis of the dividends paid by the companies listed on the UK main market.

Research highlights include:

  • Total dividends climbed by 4.1% to £32.3bn at headline level, a third-quarter record
  • Underlying dividends (i.e. excluding specials) rose 6.9% to £31.6bn, an all-time quarterly record
  • Banks and mining companies helped boost the total; retail stood out as weak spot
  • Top 100 firms outperform mid-caps owing to strong showing from a small number of large companies
  • Falling share prices and rising dividends meant equity yields jumped to 4.1%
  • Link upgrades its 2018 forecast for headline dividends by £1.1bn to a record £99.5bn, an increase of 4.8%
  • Increased forecast reflects returning strength of banking sector, weakness in sterling, and stronger than expected Q3 payouts
  • Underlying dividends (i.e. excluding specials) are now set to reach £95.8bn this year, also a record, and an increase of 8.6%