During the Prospective Period, our dividend policy is to target a dividend payout ratio of 50% of Pro Forma Operating NPAT for each of FY2017F and FY2018F. Pro Forma Operating NPAT is a non-GAAP profit measure. After the Prospective Period, we expect to increase this to between 50% and 65% of Pro Forma Operating NPAT for each financial year. The expected increase in our targeted dividend payout ratio from this time reflects that the significant investment in both capital expenditure and working capital during the Prospective Period will have been made, resulting in increased free cash flow. We anticipate that dividends will be fully imputed.
Total dividends declared in respect of FY2017F are expected to be $5.0 million (3.62 cents per Share), targeted to be paid in two equal instalments in March and September 2017.
Dividends are declared at the Board’s discretion, and will depend on our financial performance. The payment of dividends is not guaranteed, and our dividend policy may change over time. In declaring dividends, New Zealand King Salmon must comply with the solvency test under the Companies Act and the covenants in our banking facilities.
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