The Transurban Group (ASX:TCL) share price is edging higher today after providing an update on its distribution plans for 2021…
The post Here’s what the Transurban (ASX:TCL) dividend will look like in 2021 appeared first on The Motley Fool Australia. –
The Transurban Group (ASX: TCL) share price is pushing higher on Wednesday following the release of an update on its distribution plans.
In morning trade the toll road giant’s shares are up 0.5% to $13.95.
What did Transurban announce?
This morning the company revealed that a distribution totalling 15 cents per share will be paid to shareholders for the six months ending 31 December 2020 from the Transurban Holding Trust.
In addition, the company revealed that on this occasion, Transurban Holdings Limited will not be paying a dividend for the period, nor will there be any franking credits attached to its distributions.
This interim distribution is less than half of what the company paid in the same period last year. That distribution was 31 cents per share and included a 2 cent fully franked dividend from Transurban Holdings Limited.
What about the full year?
Traditionally Transurban provides its guidance for the full year with the announcement.
However, on this occasion, the COVID-19 pandemic means management cannot be specific with its plans.
It commented: “Transurban advises that it continues to anticipate that the FY21 distribution will be in line with Free Cash, excluding Capital Releases. This includes the distribution of 15.0 cents per security for the six months ending 31 December 2020.”
However, if a recent broker note out of UBS is to be believed, investors should expect a fully year distribution of 44 cents per share.
Which based on the current Transurban share price, implies a forward 3.1% dividend yield.
Distribution Reinvestment Plan.
The company also revealed that its Distribution Reinvestment Plan (DRP) will operate for the interim distribution.
However, no discount will be applied when determining the price at which stapled securities will be issued under the DRP for this distribution.
The directors have determined that the DRP pricing period in relation to this distribution will be the period of 10 trading days, commencing 7 January 2021.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Transurban Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.