Rolls-Royce Group

Website: Rolls-Royce Group
Index: FTSE 100
EPIC: RR.
Supersector: Industrial Goods and Services
Sector: Aerospace and Defense
Subsector: Aerospace
Market Cap: £108.04B
Payout Frequency: Annual

Next Rolls-Royce Group Dividend

Rolls-Royce Group next goes ex-dividend on 23/04/2026. This will be the Final dividend for 2026.

The dividend per share amount is 5.0000p (GBP) and the payment date is 03/06/2026.

Key dividend details

Final dividend declared: 5.0p per share (subject to AGM approval on 30/04/2026)
Total dividend for FY2025: 9.5p per share (interim 4.5p + final 5.0p)
Record date: 24/04/2026
Ex-dividend date: 23/04/2026 (derived as one business day before the record date)
Payment date: 03/06/2026
Payout ratio: 32% of underlying profit after tax (adjusted for one-off deferred tax credit)
Cash cost of the FY2025 final dividend: c.£419m
Dividend reinvestment plan (DRIP): available

Coverage and sustainability

Strong cash cover: FY2025 free cash flow (FCF) of £3.3bn comfortably covers total 2025 cash dividends paid (£885m) and the FY2025 final dividend (~£419m).
Earnings cover: Underlying EPS of 29.55p vs total DPS of 9.5p implies ~3.1x cover; payout ratio at 32% is moderate and leaves reinvestment headroom.
Forward cash generation: FY2026 FCF guidance of £3.6bn–£3.8bn and upgraded mid-term FCF target of £5.0bn–£5.3bn (2028) support ongoing distributions.
Balance sheet: Net cash of £1.9bn, robust liquidity (£8.7bn) and lower gross debt improve resilience of the dividend.
Operating quality: Higher group margins (17.3% underlying), strong Civil Aerospace aftermarket and Power Systems growth reinforce cash visibility, albeit with some supply chain drag.

Dividend growth outlook

Dividend reinstated and normalised in 2025: total DPS rose to 9.5p from 6.0p in 2024 (which was only a final). The 2025 final (5.0p) is lower than the 2024 final (6.0p) but offset by the new interim, indicating a move to a regular cadence.
With FCF guided up again in 2026 and upgraded mid-term targets, scope exists for gradual DPS growth if execution remains on track; no explicit payout policy target disclosed beyond the FY2025 32% payout.
Extensive buybacks should enhance per-share metrics and can complement DPS growth over time.

Capital allocation and structural factors relevant to dividends

Share buybacks: Completed £1.0bn in 2025; announced £7bn–£9bn multi-year buyback for 2026–2028 with £2.5bn in 2026 (includes £200m already completed by 20 Feb 2026). This reduces share count and dividend outflow over time.
Portfolio moves: Deconsolidation of Rolls-Royce SMR into an equity-accounted investment and the sale of the naval propulsors business (cash inflow) tighten strategic focus; SMR targeted to be FCF-positive by 2030.
Pensions: UK scheme buy-in completed (2025) and wind-up initiated (Feb 2026). No further UK funding expected; a one-off ~£100m past service charge is anticipated in 2026 but should be manageable versus cash generation.
Investment: Elevated capex to support growth (MRO capacity, Power Systems) continues, but is incorporated in guidance and still allows substantial FCF.

Risks and flags to dividend stability

Supply chain constraints: Management guides to a £150m–£200m cash impact again in 2026; parts availability remains a headwind.
Aftermarket dependence: Civil Aerospace cash flows rely on LTSA inflows and large engine flying hours; a downturn in EFH or delays in shop visit normalisation could pressure cash.
Contractual dynamics: While net onerous provisions reduced, remaining onerous contract provisions are still sizeable (£986m), and the contribution from contractual margin improvements is expected to diminish over time.
Macro/FX/geopolitics: Exposure to FX (USD), tariffs, and defence programme timing could add volatility to earnings and cash.
Capital returns intensity: The planned £2.5bn 2026 buyback materially consumes FCF; adverse shocks could prompt capital allocation rebalancing between buybacks and dividends.

Dividends Used in Calculation:

Ex-Dividend Date	Payment Date	Type	Amount	Currency
17/04/2025	16/06/2025	Final	6.00p	GBX
07/08/2025	18/09/2025	Interim	4.50p	GBX

Total (Annual Dividends Per Share): 10.50p

Dividend Yield = Annual Dividends Per Share (10.50p) ÷ Share Price (1215.5p) = 0.86%

Ex Dividend Date	Payment Date	Type	Amount	Currency
23/04/2026	03/06/2026	Final	5.0000p	GBX
07/08/2025	18/09/2025	Interim	4.50p	GBX
17/04/2025	16/06/2025	Final	6.00p	GBX
23/04/2020	01/07/2020	Final	7.10p	GBX
24/10/2019	03/01/2020	Interim	4.60p	GBX
25/04/2019	01/07/2019	Final	7.10p	GBX
25/10/2018	03/01/2019	Interim	4.60p	GBX
26/04/2018	02/07/2018	Final	7.10p	GBX
26/10/2017	03/01/2018	Interim	4.60p	GBX
27/04/2017	03/07/2017	Final	7.10p	GBX
20/10/2016	06/01/2017	Interim	4.60p	GBX
27/04/2016	01/07/2016	Final	7.10p	GBX
22/10/2015	06/01/2016	Interim	9.27p	GBX
23/04/2015	01/07/2015	Final	14.10p	GBX
23/10/2014	06/01/2015	Interim	9.00p	GBX
23/04/2014	01/07/2014	Final	13.40p	GBX
23/10/2013	06/01/2014	Interim	8.60p	GBX

Year	Interim	Final	Currency	Total	Change
2020		7.100	GBX	7.100	-39.310
2019	4.600	7.100	GBX	11.700	0.000
2018	4.600	7.100	GBX	11.700	0.000
2017	4.600	7.100	GBX	11.700	0.000
2016	4.600	7.100	GBX	11.700	-49.930
2015	9.270	14.100	GBX	23.370	4.330
2014	9.000	13.400	GBX	22.400	160.460
2013	8.600		GBX	8.600

Number of Shares:

Payment	Paid	Amount
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