Page 5 - PowerPoint Presentation
P. 5
THE DIVIDEND DECISION
Overview
• Surprisingly, successful companies display widely
divergent dividend policies. Here, some companies
choose to pay strong, consistent dividends (e.g. Kumba),
whilst others choose to not pay any dividends at all (in
the spirit of Warren Buffet and Apple Inc.). This may
lead one to predict that dividend policy is irrelevant.
• Yet, statutory requirements, shareholder preferences
and the effect of taxation make this a more complex
matter.
• Besides, regardless of the policy, you can never please
everyone: somewhere, somehow there is likely to be a
disgruntled person in the form of a shareholder, an
employee, a director, or… (fill in the blank).
• This learning unit refers to inter alia some of the
different methods and forms of dividends, and factors
to be considered before setting a dividend policy.
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