RWS Holdings

Website: RWS Holdings
Index: AIM
EPIC: RWS
Supersector: Industrial Goods and Services
Sector: Support Services
Subsector: Business Support Services
Market Cap: £311.7M
Payout Frequency: Semi-Annual

RWS Holdings Dividend Analysis and Summary

Dividend summary (key dates and amounts)

Dividend type: Final for FY2025
Amount: 4.6p per share (FY2024 final: 10.0p)
Interim already paid: 2.45p; Total FY2025 dividend: 7.05p (FY2024: 12.45p)
Record date: 16/01/2026
Ex-dividend date: 15/01/2026 (derived as one business day before the record date)
Payment date: 20/02/2026
Cash cost of proposed final dividend: ~£17.0m
Policy update: Dividend rebased to align with sustainable profit; from this base the Board intends to pursue a progressive dividend policy.

Payout, cover and cash flow support

Adjusted EPS (FY2025): 12.1p; Total dividend: 7.05p ? earnings cover ~1.7x.
Operational free cash flow (FY2025): £80.1m; FY2025 total dividend cash out at new run-rate (~£26m) ? FCF cover ~3.1x. Even on the company’s “free cash flow” metric of £56.1m, cover is ~2.1x.
Balance sheet/leverage: Net debt £25.4m (<0.5x adj. EBITDA); RCF refinanced and upsized to $285m to October 2029.

Trend and context

Final dividend down 54% y/y; total FY2025 dividend down 43% y/y (12.45p ? 7.05p).
Rebase reflects lower profits: Adjusted PBT £60.4m (-43% y/y); reported loss driven by £88m goodwill impairment and other adjusting items.

Brief analysis: sustainability and growth trajectory

Near-term sustainability: The rebased dividend appears well-covered by cash flow and modest leverage, aided by tight capex discipline and working capital improvements (cash conversion 126%).
Earnings support: Coverage on adjusted EPS is acceptable at ~1.7x, but underlying profitability is currently subdued (gross margin compression, adjusted margins reduced). The rebase prudently aligns payout with earnings capacity.
Outlook: Management guides to low single-digit OCC revenue growth, moderate margin expansion and continued strong FCF in FY2026, which should support at least stable to gently progressive dividends from the new base if execution stays on track.
Capital allocation: The new policy explicitly prioritises investment in AI products and selective M&A, suggesting dividend growth will likely be measured as the tech-led transition beds in.

Structural changes and policy signals relevant to dividends

Dividend rebase with intent to resume a progressive policy from this lower base.
Operational restructuring and cost programme (with A&M) targeting a 10% productivity improvement over 18 months.
Reorganisation into Generate, Transform, Protect segments; technology-first pivot and SaaS mix rising (46% of licence revenues).
Papercup IP acquisition (AI dubbing) integrated; continued M&A strategy envisaged.
RCF refinanced/upsized to 2029, strengthening liquidity for investment and M&A alongside dividends.
Leadership changes (new CFO joining Q1 2026; Chair and SID stepping down), which may influence capital allocation cadence in the near term.

Risks and flags to dividend stability

Profitability pressure: Adjusted PBT -43% y/y; gross margin reduced. Execution risk in margin recovery and tech transition.
Impairments: £88m goodwill write-down (Language Services and Regulated Industries) indicates lower headroom in these CGUs.
Segment headwinds: Regulated Industries revenue -10% OCC; ongoing mix shift (TrainAI/APAC/SaaS) currently at lower margins.
Exceptional/restructuring cash outflows to continue into FY2026 (~£13m indicated), temporarily absorbing cash.
FX and macro sensitivity; continued transformation and AI-led pivot carry execution risk.
Tax/UTPs and Pillar Two minimal near-term impact but worth monitoring.

Dividends Used in Calculation:

Ex-Dividend Date	Payment Date	Type	Amount	Currency
16/01/2025	14/02/2025	Final	10.0p	GBX
26/06/2025	18/07/2025	Interim	2.45p	GBX

Total (Annual Dividends Per Share): 12.45p

Dividend Yield = Annual Dividends Per Share (12.45p) ÷ Share Price (84p) = 14.82%

Ex Dividend Date	Payment Date	Type	Amount	Currency
15/01/2026	20/02/2026	Final	4.6000p	GBX
26/06/2025	18/07/2025	Interim	2.45p	GBX
16/01/2025	14/02/2025	Final	10.0p	GBX
20/06/2024	19/07/2024	Interim	2.45p	GBX
25/01/2024	23/02/2024	Final	9.80p	GBX
22/06/2023	21/07/2023	Interim	2.40p	GBX
22/06/2023	21/07/2023	Final	2.40p	GBX
26/01/2023	24/02/2023	Final	9.50p	GBX
23/06/2022	22/07/2022	Interim	2.25p	GBX
27/01/2022	25/02/2022	Final	8.50p	GBX
24/06/2021	16/07/2021	Interim	2.00p	GBX
21/01/2021	19/02/2021	Final	7.25p	GBX
25/06/2020	17/07/2020	Interim	1.75p	GBX
23/01/2020	21/02/2020	Final	7.00p	GBX
27/06/2019	19/07/2019	Interim	1.75p	GBX
24/01/2019	22/02/2019	Final	6.00p	GBX
28/06/2018	20/07/2018	Interim	1.50p	GBX
25/01/2018	23/02/2018	Final	5.20p	GBX
29/06/2017	21/07/2017	Interim	1.30p	GBX
26/01/2017	24/02/2017	Final	4.45p	GBX
23/06/2016	22/07/2016	Interim	1.15p	GBX
28/01/2016	26/02/2016	Final	3.85p	GBX
25/06/2015	24/07/2015	Interim	1.03p	GBX
29/01/2015	27/02/2015	Final	18.00p	GBX
25/06/2014	25/07/2014	Interim	4.90p	GBX
22/01/2014	21/02/2014	Final	15.75p	GBX
26/06/2013	26/07/2013	Interim	4.50p	GBX

Year	Interim	Final	Currency	Total	Change
2024	2.450	10.000	GBX	12.450	-14.720
2023	2.400	12.200	GBX	14.600	24.250
2022	2.250	9.500	GBX	11.750	11.900
2021	2.000	8.500	GBX	10.500	16.660
2020	1.750	7.250	GBX	9.000	2.850
2019	1.750	7.000	GBX	8.750	16.660
2018	1.500	6.000	GBX	7.500	15.380
2017	1.300	5.200	GBX	6.500	16.070
2016	1.150	4.450	GBX	5.600	14.750
2015	1.030	3.850	GBX	4.880	-78.680
2014	4.900	18.000	GBX	22.900	13.080
2013	4.500	15.750	GBX	20.250

Number of Shares:

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