Dividends paid by the UK companies listed on the Alternative Investment Market are set to burst through the £1 billion mark for the first time.
Justin Cooper, CEO of Link Market Services said:
“We rightly associate AIM with young companies, hungry for capital to grow. The value of capital being returned to investors via dividends is still much smaller than the amount being raised for investment, but the speed at which dividends are growing shows that more and more companies are coming of age, and reaching that important milestone where they generate more cash than they absorb. It’s frankly astonishing to see such consistent and such dramatic growth year in, year out.
“Three factors lie behind the trend to higher AIM payments. First, and most importantly, many companies on AIM are maturing, so distribution is becoming an important part of their investment story. Secondly, the size of new companies joining AIM is larger, and larger companies generally tend to pay bigger dividends. Finally, new companies joining AIM are paying dividends at an earlier stage than in the past.”