Focusrite

Website: Focusrite
Index: AIM
EPIC: TUNE
Supersector: Personal and Household Goods
Sector: Leisure Goods
Subsector: Consumer Electronics
Market Cap: £124.85M
Payout Frequency: Semi-Annual

Focusrite Dividend Analysis and Summary

Key Dividend Details

Declared dividend: Second interim dividend of 2.1p per share.
Ex-dividend date: 27/11/2025.
Record date: 28/11/2025.
Payment date: 07/01/2026.
Total interim dividends declared for the 12 months to 31 Aug 2025: 4.2p (two interims of 2.1p).
Prior comparable (FY24 interims): 6.6p. Management attributes the lower level to the change in year-end timing, with a final dividend expected to be recommended for the 18-month period ending 28 Feb 2026.
Indicative cash cost: ~£1.2m for this second interim (based on ~58.7m shares); ~£2.5m for both interims (4.2p) in the period.
Yield: not disclosed in the RNS (depends on share price at ex-date).

Coverage and Financial Support

Earnings cover (12 months to 31 Aug 2025): ~2.2x on basic EPS (9.2p vs 4.2p interims) and ~4.0x on adjusted diluted EPS (16.7p vs 4.2p).
Cash cover: underlying free cash inflow £6.2m comfortably covers the ~£2.5m cost of both interims (~2.5x).
Balance sheet: net debt £10.8m (down from £12.5m), with £24.7m adjusted EBITDA (ND/EBITDA ~0.4x) and a £50m RCF to Sep-2028.
Margins stable overall (gross margin 44.4%), working capital intensity easing (30.3% of LTM revenue vs 32.8%), and free cash flow reverting positive.

Management Commentary/Policy Signals

The 2.1p second interim is positioned as reflecting confidence in the long-term outlook; total interims are lower than last year due to reporting period change, not a policy reset.
Board expects to recommend a final dividend covering the 18-month period to 28 Feb 2026, implying timing rather than structural reduction in DPS.

Brief Dividend Sustainability Analysis

Sustainability: Strong near-term support from cash generation and low leverage; interest costs are modest relative to EBITDA. The modest interim DPS leaves ample headroom for a final dividend once the 18-month results are set.
Growth trajectory: Reported DPS is down versus the prior year’s interim run-rate but management explicitly links this to the year-end transition. Adjusted EPS declined slightly YoY (16.7p vs 18.0p), so any medium-term DPS growth likely remains prudent and paced with earnings recovery.
Capital allocation: Ongoing R&D investment (capitalised development costs ~£10.4m) and eCommerce capability build continue, but underlying free cash flow has improved, and net debt reduced—supportive backdrop for maintaining/gradually growing dividends.

Structural or Policy Changes Relevant to Dividends

Change of year-end to 28 February (from 31 August) affects dividend timing. Expectation of a final dividend for the 18-month period to Feb-2026.
Operational reorganisation (minor restructuring; £0.5m cost) to streamline Content Creation; no share consolidation announced.
RCF maturity extended to September 2028, improving financing visibility.

Risks and Flags to Dividend Stability

US tariff uncertainty (>20% on many imports) and possible further changes; company is reallocating manufacturing and adjusting pricing but notes a dynamic risk environment.
US macro softness and elevated US channel inventory (planned unwind over 12–18 months) could affect near-term sales cadence and working capital.
Segment mix: Audio Reproduction revenue down 3.8% and margins normalised; total gross margin held but mix could pressure profitability if weakness persists.
Adjusted EPS down YoY (16.7p vs 18.0p), suggesting disciplined DPS growth is prudent until earnings momentum reaccelerates.
FX and supply chain exposure (Asia manufacturing) remain ongoing considerations, albeit partially hedged and mitigated.

Dividends Used in Calculation:

Ex-Dividend Date	Payment Date	Type	Amount	Currency
24/12/2024	07/02/2025	Final	4.5000p	GBX
08/05/2025	09/06/2025	Interim	2.1000p	GBX

Total (Annual Dividends Per Share): 6.60p

Dividend Yield = Annual Dividends Per Share (6.60p) ÷ Share Price (214.8p) = 3.07%

Ex Dividend Date	Payment Date	Type	Amount	Currency
27/11/2025	07/01/2026	Final	2.1000p	GBX
08/05/2025	09/06/2025	Interim	2.1000p	GBX
24/12/2024	07/02/2025	Final	4.5000p	GBX
09/05/2024	10/06/2024	Interim	2.1000p	GBX
28/12/2023	31/01/2024	Final	4.5000p	GBX
11/05/2023	09/06/2023	Interim	2.1000p	GBX
12/01/2023	17/02/2023	Final	4.15p	GBX
12/05/2022	10/06/2022	Interim	1.85p	GBX
30/12/2021	31/01/2022	Final	3.70p	GBX
13/05/2021	11/06/2021	Interim	1.50p	GBX
07/01/2021	29/01/2021	Final	2.90p	GBX
13/08/2020	28/08/2020	Interim	1.30p	GBX
09/01/2020	31/01/2020	Final	2.60p	GBX
09/05/2019	05/06/2019	Interim	1.20p	GBX
27/12/2018	18/01/2019	Final	2.30p	GBX
03/05/2018	30/05/2018	Interim	1.00p	GBX
28/12/2017	19/01/2018	Final	1.95p	GBX
11/05/2017	09/06/2017	Interim	0.75p	GBX
01/12/2016	18/01/2017	Final	1.30p	GBX
05/05/2016	03/06/2016	Interim	0.65p	GBX
17/12/2015	03/02/2016	Final	1.20p	GBX
28/05/2015	26/06/2015	Interim	0.60p	GBX

Year	Interim	Final	Currency	Total	Change
2022	1.850	4.150	GBX	6.000	15.380
2021	1.500	3.700	GBX	5.200	23.800
2020	1.300	2.900	GBX	4.200	10.520
2019	1.200	2.600	GBX	3.800	15.150
2018	1.000	2.300	GBX	3.300	22.220
2017	0.750	1.950	GBX	2.700	38.460
2016	0.650	1.300	GBX	1.950	8.330
2015	0.600	1.200	GBX	1.800

Number of Shares:

Payment	Paid	Amount
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