Moneysupermarket.com Group Declares £70m Special Dividend As Founder Sells Shares for £160m
LONDON -- The shares of Moneysupermarket.com fell 6 pence to 202 pence during early London trade this morning after the FTSE 250 mid-cap said it would pay a 12.92 pence per share special dividend during July.
Moneysupermarket, which operates one of the country's leading financial comparison websites, said the payment reflected the company's confidence in its "ability to generate cash on an on-going basis."
The special dividend will cost the company £70 million and will be funded through existing cash balances and extra loans.
Published in March, Moneysupermarket's 2012 results showed the business enjoying cash of £19 million and no debt. The figures also showed adjusted earnings up 28% and the ordinary dividend up 27%.
Alongside the special dividend announcement, Moneysupermarket also revealed this morning that its group revenues for the year to date had advanced more than 10% on the same period last year.
In addition, the website's founder, Simon Nixon, said this morning that he would sell up to 80 million shares in the company to City institutions through an "accelerated bookbuild." He could raise up to £160 million.
Gerald Corbett, the chairman of Moneysupermarket.com, said today:
The Board remains committed to a progressive dividend policy in line with the investment and capital needs of the business.
The placing by Simon Nixon will increase liquidity and help normalise the Company's shareholding structure. Simon remains a major shareholder and will continue to play a key role on the Board as the Non-Executive Deputy Chairman.
Based on current forecasts, Moneysupermarket is valued at about 19 times near-term profits and offers a 3.3% yield.
Of course, whether that rating, today's special dividend news, Simon Nixon's share sale and the company's irritating television adverts all combine to make Moneysupermarket a buy or a sell is something only you can decide.
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