Fonterra's Board seeks to maintain a consistent dividend stream in the normal course of events. This is expected to be between 65% to 75% of adjusted net Profit After Tax over time. In considering payment of the dividend, the Board will have regard to all relevant factors, but in particular:
- Any non-recurrent items that affect profit after tax;
- Average dividends paid over the previous three years;
- Near-term earnings projections, investment priorities and gearing targets; and
- Any other factors the Board considers relevant, including existing or likely market conditions that may impact Fonterra or our shareholders.
The Board has indicated that it will target 40% to 50% of the annual dividend to be paid at the half year.
The Fonterra Board has the discretion to distribute any surplus capital to shareholders by way of a Special Dividend or other alternative distribution methods.