FTSE 350 listed companies are expected to pay a record level of dividends in the second quarter, buoyed by a weaker pound against the dollar and a £3bn special dividend by National Grid plc (LON:NG).
IHS Markit has predicted shareholders will receive a total £20.7bn in pay-outs in the second quarter, a 25% increase compared to the same period a year earlier.
National Grid provided a boost to the total as it plans to return £4bn to shareholders, including a £3bn special dividend, following the sale if its 61% equity interest in its gas pipes business last month in a deal valued at £14bn.
The National Grid Gas Distribution arm was sold to a consortium, including Macquarie Infrastructure and Real Assets, Allianz Capital Partners, Hermes Investment Management, CIC Capital Corporation, Qatar Investment Authority, Dalmore Capital, Amber Infrastructure Limited and International Public Partnerships.
A stronger greenback versus sterling has also provided a lift to dividends as 33% of the estimated pay-outs are determined in dollars, including from the likes of BP plc (LON:CP), Royal Dutch Shell plc (LON:RDSA) and HSBC Holdings plc (LON:HSBA).
The pound has slumped against the dollar since the UK voted to leave the European Union last June.
Ordinary dividends are forecast to rise 9% year-on-year to £17.4bn in the second quarter. Excluding favourable exchange tailwinds, ordinary dividends are predicted to grow by a modest 1.7% to £16.3bn.
Vodafone Group plc (LON:VOD), Royal Dutch Shell, HSBC and BP had the largest dividend pay-outs after National Grid with a combined £12.7bn.
Utilities represented 25% of the total while oil majors accounted for 22%.