Billington Holdings

Billington Holdings Dividend Analysis and Summary

• Dividend: 11.0 pence per share (final)
• Coverage: 2.46x by underlying earnings (Underlying EPS: 27.1p); statutory EPS: 10.4p
• Payout ratio (underlying basis): ~41%
• Ex-dividend date: 04/06/2026
• Record date: 05/06/2026
• Payment date: 30/06/2026 (subject to AGM approval on 02/06/2026)
• Cash cost: c.£1.47m
• Policy: dividend set to “reflect underlying earnings” while maintaining a robust balance sheet
• Context: prior year final dividend 25.0p; FY2025 final implies a 56% cut YoY; no interim (consistent with prior years)

• Earnings support: Underlying EPS of 27.1p gives solid cover at 2.46x; however, on a statutory basis (10.4p EPS) the dividend would be not covered (c.0.9–1.1x), highlighting reliance on “underlying” adjustments (notably £2.8m Yate-closure costs).
• Cash and balance sheet: Net cash of £20.5m, debt-free, and an undrawn £6m RCF provide headroom to fund the dividend and selective investment even through cyclical softness.
• Earnings trajectory: FY2025 saw pressure (revenue down 15%, underlying PBT £4.1m), but management guides to an improved 2026 with a strong order book and margin recovery from mix/efficiency gains. If delivered, cover should remain comfortable and may allow gradual dividend rebuilding.
• Capital allocation: Five-year capex program largely complete; 2026–27 capex to be lower (two major machines deferred). This eases cash demands and supports dividend capacity. Ongoing appraisal of bolt-on M&A suggests discipline but could compete with cash returns if opportunities arise.