News Column

Electronic Data Processing Pays Special Dividend As Profit Declines

May 29, 2014

Hana Stewart-Smith

LONDON (Alliance News) - Electronic Data Processing PLC Thursday signalled its confidence for the future by announcing a special interim dividend, as it saw pretax profit decline in the half-year to end-March, hit by order delays.

The software and services company proposed a special interim dividend of 3 pence per share. It expects to declare a final dividend of 2 pence per share for the full-year, maintained from the previous year, and going forward to raise its level of total ordinary dividends to 5 pence in total.

In the previous year the company paid a special interim dividend of 5 pence.

Electronic Data Processing posted a pretax profit of GBP162,000, down from GBP326,000 in the previous year, as revenue declined to GBP2.6 million from GBP2.9 million, hit by delays in customer orders.

The company said it had seen customer orders delayed in the last two months of the half-year, however, its April and May sales have returned to more normal levels, in line with the second-half of the previous year.

It said that due its relatively large cash balance it had decided to raise its level of ordinary dividends, although this was still subject to acquisition opportunities that may arise.

Electronic Data Processing warned that one of its larger customers has acquired a competing software business, and as a result it expects to lose business from this customer in due course. However, it does not expect this customer loss to hit it current year.

It continued to make progress on its strategy of shifting a higher proposition of its business to cloud hosting services, increasing this proportion to 49% from 44% in the previous year.

Shares in Electronic Data Processing were trading down 3.0% at 82.00 pence Thursday afternoon.

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Source: Alliance News