Dividend Policy Update
‒ comply with all funding covenants and the solvency test in the Companies Act. Dividends are made only at the discretion of the Board of Vector. The payment of dividends is not guaranteed and Vector’s dividend policy may change.
Shareholders will receive a partially imputed HY dividend of 8.25 cents per share. When the Vector Board approved the current dividend policy in 2017 it was noted that the policy would be reviewed having regard to the impact on Vector’s revenue of the Commerce Commission’s DPP3 reset for Vector’s electricity network. The DPP3 period comes into effect from 1 April 2020. The Board has decided to move from a progressive dividend policy of increasing dividends by 0.25 cents per annum, to a policy of maintaining the current dividend of 16.5 cents per annum with the expectation of continuing to increase dividends in the future based on projected growth in Vector’s businesses. Vector will attach imputation credits to dividends at a rate of 10.5%. Vector will ensure that in considering the payment of any dividend, the company will; ‒ maintain its current BBB credit rating with Standard & Poor’s, or equivalent; ‒ have the financial capacity to meet its medium-term investment and operating requirements, and;
Strengthening network resilience
Vector remains committed to meeting its regulatory compliance targets. In the six-month period we increased efforts to combat outage restoration delays caused in part by increasing Auckland traffic. This included commissioning a new depot to make it more efficient for crews to access network equipment required to carry out certain types of repair work in the North and West areas of Auckland. To further minimise community disruption caused by power outages, Vector has recently joined calls for changes to Land Transport rules to allow lines mechanics to use flashing lights on their response vehicles. As homes and businesses become increasingly dependent on a reliable supply of electricity, we believe response crews should be permitted to gain access to flashing lights to
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