Retrieved from https://studentshare.org/miscellaneous/1553410-dividend-policy
https://studentshare.org/miscellaneous/1553410-dividend-policy.
Arriva is one of the biggest names in the transport service business in the European market. Arriva’s balance sheet for the last 5 years (from 2004-2008) is densely populated with debt financing and it is obvious because Arriva is a servicing business. Its debt financing of the last 5 years lies between (65% to 76%) and its equity financing lies between (24% to 35%). The summary of Arriva’s last 5-year dividend policy is summarized below:
DIVIDEND INFORMATION OF ARRIVAL
(FROM 2008 - 2004)
YEARS
2008
2007
2006
2005
2004
Final (GBp per share)
24.06
22.65
20.83
19.84
18.90
(Annual Report, 2008-2004)
KEY FACTORS INFLUENCING ARRIVA’S DIVIDEND POLICY: (From 2008 - 2004)
After reviewing the whole 5 years dividend policy and dividend structure, it is quite evident that Arriva maintains a progressive dividend policy and also utilizes its capital structure at the utmost level.
FACTORS THAT INFLUENCE THE DIVIDEND POLICIES FOR UK COMPANIES:
According to the survey conducted by Dr. Stuart Archbold which emphasis that most UK companies pay attention to the following elements while formulating their dividend policy:
Some factors influenced dividend policy. The factors are:
CONCLUSION:
In conclusion of dividend policy suggests that there are three schools of thought regarding the dividend policy. The first is that dividends are neutral, and they neither increase nor decrease value.
The second view is that the taxation on dividends which are higher than the capital gains demolishes the value of stockholders. The third school of thought makes the argument that dividends are valuable for some organizations. It is a fact that in all of these arguments, there are some valid points that exist and it is the prime responsibility of the firm to make a consensus among them.
Read More