EDP provides bonus for shareholders as it looks for acquisitions
ELECTRONIC Data Processing (EDP) said today it plans to use its cash pile to raise its dividend payments as it continues to look for acquisitions.
The Sheffield-based wholesale distribution IT supplier saw profits and turnover fall in the first half of the year because of delays to a number of orders but said that sales have returned to normal levels since the end of its half year.
The group said that turnover fell to £2.62m from £2.93m in the six months to March 31 while adjusted operating profit was £202,000 compared to £431,000 a year ago.
EDP saw hosting revenues strengthen further and they now represent 49% of total revenues (2013: 44%) while contracted recurring revenues were maintained at £2.2m representing 84% of total revenues
The group said it has a strong, debt-free balance sheet with cash balances of £5.5m and will pay a special interim dividend of 3p per share, returning £378,000 to shareholders.
It also plans to pay a final ordinary dividend of 2p per share for the current financial year with its dividend policy in future years reviewed to raise the level of ordinary dividends to 5p in total, 2p at the interim and 3p at the final.
Sir Michael Heller, chairman of EDP, said: “We continue to follow a policy of maintaining a strong balance sheet to protect the business and to provide flexibility of funding for our growth including acquisitions should suitable opportunities arise.
“In view of our continuing, relatively large cash balance, we have as a board reviewed our dividend policy and have decided, in principle, to raise the level of ordinary dividends going forward, subject still to acquisition opportunities that may arise and our overall cash position at the time.
“We look forward to the future with confidence.”
