Iceland set to pay £100m full year dividend

SUPERMARKET chain Iceland Foods is to pay an £100m dividend this year to management and creditors of its former Icelandic bank owners, for the first time in three years.

Iceland is expected to report a bounceback in revenues and profits this year as budget-conscious shoppers turned to its stores and the dividend would be paid from cash reserves, the Financial Times reported.

The dividend will be declared for the year to 31 March, and is the first since 2007 when it paid out £300m after it was refinanced.

Iceland should report earnings before interest, tax, depreciation and amortisation of £190m in the year to March, from £180m the previous year.

Management, including its founder and chief executive Malcolm Walker, owns about 26 per cent of the firm while the rest is held by two Icelandic banks, Landsbanki and Glitnir, which collapsed in the financial crisis.

The banks, whose creditors should welcome the payout, took over the stake from a third failed investment group, Baugur, which had invested in a number of high street retailers.

The winding up board of Landsbanki is expected to put Iceland up for sale soon, though no formal move to do so has been made yet.