Nichols' (LON:NICL) Dividend Will Be Increased To £0.697

historic-dividend

Nichols plc (LON:NICL) will increase its dividend on the 6th of September to £0.697, which is 453% higher than last year's payment from the same period of £0.126. Based on this payment, the dividend yield for the company will be 2.4%, which is fairly typical for the industry.

Nichols Is Paying Out More Than It Is Earning 

Solid dividend yields are great, but they only really help us if the payment is sustainable. Prior to this announcement, Nichols' dividend was comfortably covered by both cash flow and earnings. This indicates that a lot of the earnings are being reinvested into the business, with the aim of fueling growth.

Over the next year, EPS is forecast to expand by 39.3%. However, if the dividend continues along recent trends, it could start putting pressure on the balance sheet with the payout ratio reaching 121% over the next year.

Full story at Yahoo News.