UK plc dividend growth slowest since 2010 as strong pound weighs on payouts

Dividends from UK firms last year grew at the slowest rate since 2010 as the strong pound continued to weight on payouts.

According to the latest Capita Dividend Monitor, underlying dividends (with special dividends stripped out) came in below expectations at £79.1bn in 2014, an increase of just 1.4% from the previous year, and the weakest growth rate in four years. The biggest contributor to the decline was the strength of sterling in the first half of 2014, which knocked £3.5bn off the full-year total, Capita said. However, headline dividends rose by 21% from £80.4bn to £97.4bn, helped by Vodafone's special dividend payout of £15.9bn. For the 40% of dividend-paying companies which report in US dollar...