Next has called a meeting of shareholders to deal with an inadvertent infringement of UK company law over reporting the payment of dividends.
The “procedural oversight” concerns the payment of one ordinary dividend and three special interim dividends in 2014 and 2015, the fashion retailer said.
Next said it had the money to pay the dividends but that it failed to file accounts with Companies House before the payouts were made, as required by company law. The company will hold a shareholder meeting on 10 February to vote on a resolution to rectify matters.
The company, run by Conservative peer Lord Wolfson, is regarded as having one of the UK’s slickest operations for managing dividends and shareholder returns. It has made special payouts to investors and regularly goes into the market to buy back shares to return spare cash to shareholders.
“The issue is of an historic nature and there is no change to the financial outlook of the company as a consequence of this technical matter,” Next said.
The chain said the necessary adjustment would have no effect on its ability to return surplus cash to shareholders through dividends or buybacks. It has not been fined, past accounts will not need to be reinstated and dividends will not need to be repaid, Next said.
Retail analyst Nick Bubb said the error was a “footling matter” but that it was embarrassing for Next and Wolfson, whom Bubb calls “Mr Share Buyback Man”. Shareholders appeared unperturbed by the glitch as Next shares rose 1.4% to £67.40.
Next has reduced its profit guidance for this year after reporting disappointing sales over Christmas because of weak demand for warm clothes during the mildest December weather on record.
This article was written by Sean Farrell, for theguardian.com on Tuesday 19th January 2016 09.44 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010