RE: Sums11 Jun 2026 21:04
The key sentence
"Interim dividend of 1.75p (HY25: 2.45p) is consistent with rebasing of the FY25 final dividend and typical phasing across the year."
There are two separate messages embedded here:
"consistent with rebasing of the FY25 final dividend"
"and typical phasing across the year"
The first part explains why the interim is lower than last year's 2.45p.
The second part is more interesting because they could simply have stopped after the first phrase.
What is "typical phasing"?
Historically RWS has been remarkably consistent:
FY Interim Final Total Interim %
2021 2.0p 8.5p 10.5p 19%
2022 2.25p 9.5p 11.75p 19%
2023 2.4p 9.8p 12.2p 20%
2024 2.45p 10.0p 12.45p 20%
2025 2.45p 4.6p 7.05p 35%
FY25 was clearly an anomaly because the board rebased the dividend after the interim had already been paid.
Before the rebase, the pattern was essentially:
20% interim / 80% final
every year.
What would "typical phasing" imply now?
If management wanted to maintain the historical split:
1.75p = 20%
Total dividend =
1.75 ÷ 0.20
= 8.75p
Final dividend =
8.75 - 1.75
= 7.0p
Exactly as you've calculated.
Look at the numbers:
FY25 rebased dividend
Interim: 2.45p
Final: 4.6p
Total: 7.05p
Management explicitly said that from this rebased level they intend to resume a progressive dividend policy.
Now in H1:
Interim = 1.75p
Trading materially improved
PBT up 33%
OCC growth accelerated from 1.4% to 7%
Guidance maintained
Strong Generate performance
AI revenue now 32% of sales
Nothing in this statement suggests a company trying to conserve cash. Quite the opposite.
If they wanted investors to assume a flat 7.05p dividend again, they could simply have said:
"The interim dividend reflects the rebased dividend policy."
Instead they added:
"and typical phasing across the year."
That appears intentional.
Many screening systems will show:
FY25 dividend = 7.05p
Interim dividend cut from 2.45p to 1.75p
and conclude:
"Dividend down 29%."
But if management is quietly reverting to historical phasing, then:
FY26 dividend could be ~8.75p
Yield at 90-95p share price is around 9-10%
which would be materially better than the market currently assumes.
I wouldn't yet treat 8.75p as guaranteed.
A few reasons:
1. They never explicitly said "returning to 20/80"
They only referenced "typical phasing".
That's a hint, not guidance.
2. Acquisition integration
They've just bought Obviously and stated a £1m FY26 PBT impact from the acquisition. They are still investing heavily in AI products.
3. Balance sheet has moved
Net debt moved from net cash last year to around £33m net debt after dividends, capex and exceptional costs. It's not alarming, but they aren't swimming in excess cash.
The wording around "typical phasing across the year" makes me think management is nudging investors toward something close to the 8.75p number you've derived.
I would not be surprised at all if the final di
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