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magazineSSE’s £324.5m cash saving trick
Investors buy utility stocks largely for their reliable and hefty dividends. Compounding, where investors reinvest their income back into new shares, has significant potential for value creation.
Energy big six supplier SSE (SSE) operates a scrip dividend scheme and is reaping the rewards, saving a staggering £324.5m in cash after 27,670 shareholders elected to take their latest payout in new shares.
That was for the final, or second half, 63.9p per share dividend. That will mean issuing nearly 23.5m new shares in the company, beefing up the shares in issue count by 2.35%.
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