Aviva Announcement

[idpickering]

Aviva Upgrades Growth, Cash and Dividend Targets

Aviva plc ("Aviva") is announcing today upgrades to its targets for earnings growth, cash and dividend at a conference for investors and analysts.



Over the last four years Aviva's financial and strategic position has been transformed. The capital surplus has tripled; the group has been streamlined and Aviva is now focused on markets where it has high quality franchises and is gaining market share.



As a result Aviva is upgrading the financial objectives it set out previously. Specifically:

https://www.investegate.co.uk/aviva-plc ... 00069197X/

[tjh290633]

You missed the bit which said that they will raise the payout ratio to 55-60% of operating EPS by 2020.

TJH

[Dod101]

Sounds good, but I wonder if it will last? This company does not have a great record but good luck to any who do own it as it seems to be developing along the right lines.

Dod

[monabri]

I would add this bit -

"Over the last four years Aviva's financial and strategic position has been transformed. The capital surplus has tripled; the group has been streamlined and Aviva is now focused on markets where it has high quality franchises and is gaining market share".

Mark Wilson has been group CEO for 4.8 years so perhaps under his guidance they are moving "in the right direction".

[jackdaww]

i like aviva and continue to add at these prices .

[beeswax]

You missed the bit which said that they will raise the payout ratio to 55-60% of operating EPS by 2020.

TJH

Anyone know how that would relate to actual dividend payments compared with now? I think its around 25p per share for the full year. Its the only share I own!

Oh BTW, Sorry for my ignorance but are these dividends tax free ie the tax has been paid by Aviva or does this need to be declared as a basic rate taxpayer as read somewhere that tax free dividend income has been reduced significantly? I am aware that higher rate taxpayers have a further liability or did have.

The market loved this announcement early on and then gave up all the gains later. It seems very positive as even the current dividends are very good.

[monabri]

The forecast dividend payout ratio is ~49% for year ending 31/12/17. (divi 25.99p /EPS 52.94p)
http://www.digitallook.com/equity/Aviva

The message that they plan to increase the ratio to 55-60% ? This implies they plan to run with a reduced dividend cover by 2020 ?

(they could achieve 55% if the divi was static but the EPS reduced!)


Tax wise - For this tax year you can earn £5k in dividends before any tax is due. (Question - has the reduction to £2k for next tax year been ratified?)

Of course, if your shares are in a tax free wrapper then you're ok to whatever amount.

Aviva will NOT have taken the tax off for you - they will give you the full divi untaxed.

[PinkDalek]

... (Question - has the reduction to £2k for next tax year been ratified?) ...

Yes, see viewtopic.php?p=98924#p98924 for the detail.

[beeswax]

The forecast dividend payout ratio is ~49% for year ending 31/12/17. (divi 25.99p /EPS 52.94p)
http://www.digitallook.com/equity/Aviva

The message that they plan to increase the ratio to 55-60% ? This implies they plan to run with a reduced dividend cover by 2020 ?

(they could achieve 55% if the divi was static but the EPS reduced!)


Tax wise - For this tax year you can earn £5k in dividends before any tax is due. (Question - has the reduction to £2k for next tax year been ratified?)

Of course, if your shares are in a tax free wrapper then you're ok to whatever amount.

Aviva will NOT have taken the tax off for you - they will give you the full divi untaxed.

Thanks for all that info Monabri, appreciated.

The RNS was suggesting they have 3bn of excess cash...and so maybe that answers your question?

http://www.hl.co.uk/shares/shares-searc ... dinary-25p

I'm happy to hold just for the current dividend alone and its highly rec'd if that means anything nowadays?

[Gengulphus]

Oh BTW, Sorry for my ignorance but are these dividends tax free ie the tax has been paid by Aviva or does this need to be declared as a basic rate taxpayer as read somewhere that tax free dividend income has been reduced significantly? I am aware that higher rate taxpayers have a further liability or did have.

Prompted by your question, I started writing a reply to try to summarise dividend taxation and how it has changed. And that reply grew until it was clearly much more appropriate for the Taxes board than this one... So I grew it some more and have now posted it there - it's in viewtopic.php?f=49&t=8769.

One thing I will point out here is that things one remembers reading somewhere about taxation need to be treated with caution, because of the danger of them being out-of-date. That doesn't apply in your specific case, which is pretty clearly about the reduction to the 'dividend allowance' next April. But more generally, it is currently quite a significant danger for material about dividend taxation, because the last major change to dividend taxation is still quite recent (April 2016).

Gengulphus