Bowater advances payout: Packaging group joins list of companies that have sidestepped budget measure

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The Independent Online
BOWATER, the packaging, print and industrial coating group, yesterday joined the list of companies to sidestep the Chancellor's Budget proposals concerning tax credits on dividends.

Instead of the customary final dividend, the company is to pay a second interim of 6.65p a share. The payout has also been brought forward by two months, beating the Budget deadline of 5 April.

The move enables Bowater's institutional shareholders and non-tax- paying private investors to claim a tax credit of 25 per cent one more time before it is cut to 20 per cent.

The second interim, to be paid on 2 April, lifts the total payout for the year by about 12 per cent to 11.5p, in line with the company's forecast last month, when it launched a pounds 295m rights issue.

Taxable profits jumped by almost half to pounds 147m on group sales up by a quarter to pounds 1.6bn. Earnings per share rose by 12.5 per cent to 25.2p.

The profits increase reflected improved margins and the benefits of three strategic acquisitions last year. However, a weaker pound pushed the group's net debts up from 35 to 56 per cent of shareholders' funds.

City analysts expect the company to boost taxable profits to about pounds 200m this year. Bowater shares closed unchanged at 490p yesterday.

Wolseley move, page 30

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