The Provident Finalcials group's dividend policy is to maintain a dividend cover ratio of at least 1.4 times as the home credit business recovers and moves into profitability. This will reflect the group's current risk appetite of maintaining regulatory capital headroom in excess of £50m and progressively absorbing the remaining transitional impact of IFRS 9 on regulatory capital by 1 January 2023.
The Board is recommending an increase in the final dividend of 60.0% to 16.0p per share (2018: 10.0p) which, together with the 9.0p interim dividend (2018: nil), represents a 150.0% increase in the total dividend per share to 25.0p (2018: 10.0p). Dividend cover for 2019, prior to the amortisation of acquisition intangibles and exceptional items, is 1.9 times (2018 (restated): 4.9 times).
As communicated in March 2019, as well as bringing forward the payment of interim dividends from late November to late September, the Board has brought forward the payment of final dividends from late June to late May. The 2019 final dividend will therefore be paid on 22 May 2020.
Other financial highlights include:
Group adjusted profit before tax up 1.6% to £162.6m (2018 (restated1): £160.1m), as the business continues to adapt to the evolving regulatory environment and successfully defended the hostile NSF bid.
Statutory profit before tax up 32.4% to £128.8m (2018 (restated1): £97.3m), reflecting lower exceptional costs.
Strategic initiatives outlined at the Capital Markets Day in November are well underway to deliver the group's 'Vision for the Future' and financial targets.
Agreement of a £275m bilateral securitisation facility in early January 2020 to fund Moneybarn's business flows.
ROP refund programme at Vanquis Bank and FCA investigation at Moneybarn both now complete.
Regulatory capital headroom of approximately £90m at 1 January 20204.
Total dividend per share of 25.0p per share (2018: 10.0p), up 150% on 2018, and representing dividend cover of 1.9 times (2018 (restated): 4.9 times).
