UK ‘poised for bumper dividend growth'

The UK dividend market is emerging from the recession faster and stronger than expected, after a week in which many companies reported dividend increases of over 100% and many returned to the register.

Last week mega caps such as AstraZeneca and British American Tobacco, favourites of managers in the UK Equity Income sector, both announced dividend increases of 15%, while Croda and Renishaw said dividends were rising 150% and 100% respectively. Meanwhile, National Express, ITV, CML and Inchcape were amongst names announcing a first dividend or return to the list. Although managers are not yet exiting overseas positions in favour of the local market, all agree the UK is set for a huge boost in dividend growth. MAM funds’ Gervais Williams, manager of the recently launched £48m Dive...