Proposed dividend cuts weigh on UK outlook after strong Q1 - Capita

Cuts of £2.7bn announced

Dividend growth in the UK is unlikely to last during 2016, according to Capita Asset Services, despite the headline rate increasing by 6.4% in Q1.

According to the latest quarterly Capita Dividend Monitor, headline dividends rose during the first three months of the year to £14.2bn, while underlying dividends were up 1.3% to £13.2bn.  Headline figures were boosted by a number of special payouts from companies such as retailer Next and chemical firm Johnson Matthey.  Capita also said the demotion of Aberdeen Asset Management to the FTSE 250 in February was a positive for mid-cap companies, as its £158m payout helped dividends to grow by 31% to £1.4bn.  Investors also benefitted from sterling weakness, which added £350m to tota...