Capita cuts dividend forecast for 2013 as UK economy weakens

Capita Registrars has cut its UK dividend growth projection for 2013 from 8% to 6.7%, warning payouts cannot outstrip GDP growth indefinitely.

The group’s latest Dividend Monitor report said investors should be braced for a pullback in UK dividend growth after payouts hit record highs in 2012. UK firms paid out a record £80.4bn in dividends last year and underlying growth, which excludes special dividend payouts, stood at 8.9%. However, growth in payouts slowed in the second half of the year and this will continue, Capita said. Justin Cooper, Capita Registrars’ chief executive, said the firm has cut its forecast for underlying dividends from £81bn to £78.6bn, reducing its growth rate projection from 8% to 6.7%.  The impac...