The FTSE 100 (FTSEINDICES: ^FTSE) is up 7 points to 6,754 as I write, taking it up 19 points on the week so far and possibly heading for its fifth week of gains in a row. That’s nice, but what many forget is that there’s an extra 3% on average to be had from FTSE 100 dividends, and that alone is enough to beat a savings account.
Of course, you do need to know how long to hold your shares if you want your cash — if you keep them until the end of trading on ex-dividend day, you’ll be fine. And if you’re looking for bargains, it pays to know that prices often fall further than the applicable dividend on ex-dividend day.
Here are three FTSE 100 companies reaching their cut-off day next Wednesday, 13 November:
British Sky Broadcasting
It’s ex-dividend day for British Sky Broadcasting Group (LSE: BSY), with respect to a final dividend of 19p per share for the year ended 30 June. That boosted the firm’s full-year dividend by 18% to 30p per share, for a yield of 3.2% on today’s share price of 941p.
It’s the ninth year in a row of dividend growth for Sky, and this year’s hike was made possible by a 7% rise in revenue to £7,235m, with EBITDA up 8% to £1,692m and earnings per share up 18% to 60p.
The share price has done well too, climbing 25% over the past 12 months after getting a subsequent boost from October’s third-quarter update.
GlaxoSmithKline
There’s 19p per share to come from GlaxoSmithKline (LSE: GSK) (NYSE: GSK.US), too, and this time its an interim dividend for third quarter. That was 6% up on the same quarter a year ago, and the same rise in the total payment for the year would provide 78.4p for a yield of 4.7% on the current 1,653p share price. That would be a slightly lower yield than last year, but the shares are up nearly 20% on a year ago.
Glaxo reaffirmed its intention to return cash to shareholders through dividends and share buybacks, and told us it has repurchased £1bn in shares so far with a year-end target of £1-2bn.
Royal Dutch Shell
Our third going ex-dividend next Wednesday is Royal Dutch Shell (LSE: RDSB), and there’s a 45c-per-share (28p) third-quarter payment in the pipeline. Despite the dividend, Q3 results were disappointing and led to a 5.2% share price slump on the day to 2,159p — since then we’ve seen a slight recovery to 2,184p today.
The big shock was a 32% crash in current-cost-of-supplies earnings, after Shell suffered from higher costs, lower volumes, and continuing difficulties in Nigeria.
For the full year there’s a total dividend of 113p forecast, which would yield a pretty nice 5.2%.
