London-listed companies announced a slew of buybacks and dividends on Thursday, as management teams begin to pass on gains made from the global bounce back from COVID-19.
Interim results season begins in the UK this week and most companies have so far reported strong results, buoyed by the reopening of economies around the world as the COVID-19 pandemic begins to come under control. Firms are now rewarding shareholders for their faith during what was an exceptionally difficult 2020.
FTSE firms announced investor payouts worth more than £7bn on Thursday alone. Notable capital returns include:
a £1bn interim dividend at Diageo (DGE.L);
The flurry of payout news helped the FTSE 100 (^FTSE) rise 0.7% on Thursday, despite a rallying pound.
"No one would begrudge investors heading home to pop open a bottle of fizz - it’s just been that kind of a day," said Danni Hewson, a financial analyst at AJ Bell. "A bumper crop of earnings bolstered by news of some hefty dividend pay outs and nothing too challenging emerging from across the Atlantic."
News of the payout blitz comes a day after miner Rio Tinto (RIO.L) announced a record $9.1bn (£6.5bn) dividend. The blockbuster payout – its biggest ever – is worth more than roughly a quarter of FTSE 100 companies.
Barclays (BARC.L), meanwhile, confirmed a £340m dividend payout for investors and announced a £500m share buyback programme on Wednesday.
The return of dividends and buybacks will provide cheer to investors who endured a lean 2020. Last year was the worst for UK dividends in a decade, according to Link Group. Payouts rebounded 50% to £25.7bn in the second quarter, Link said earlier this week.
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