Taylor Wimpey’s confirmation of its return to the dividend list, first hinted at last November, makes it the twenty-sixth FTSE 100 firm to resume payments or promise to do so.
The company is already outlining plans for an interim dividend in 2021 and special dividends in 2022, so chief executive Pete Redfern and his team clearly do not lack confidence in either the housing market or their ability to make the most of it, says Russ Mould, AJ Bell Investment Director.
“With the Government about to unveil yet another scheme to stoke demand for houses – even if the problems are a shortage of supply and prices that are too lofty rather than too little demand – you can see why that would be the case, even allowing for Taylor Wimpey’s decision to set aside £125 million in 2021 to cover fire safety improvement in apartment buildings built over the last two decades.
“Taylor Wimpey’s final dividend payment for 2020 and interim payment for 2021 are both based upon a policy to pay out 7.5% of company net assets over the course of a year. With net assets (or shareholders’ funds) of £4 billion, that equates to £301 million and Taylor Wimpey is therefore planning a final payment of 4.14p for 2020 and an interim figure of the same for 2021.