Micro Focus set for £83m payout despite challenging conditions

MICRO Focus International plans to pay out £83m to shareholders – 50p per share – the software company announced yesterday.

The FTSE 250 company, which provides computer mainframes for large organisations, also said it had traded “in line with management expectations” in the quarter to August. Analysts said the dividend, set to be paid in November following approval at September’s annual meeting, came earlier than expected.

The Berkshire-based firm reported a 30 per cent annual profit leap in June, but said revenue over the next year would be fairly flat due to weakness in the Eurozone. Micro Focus reiterated their concerns today, saying turnover would be between minus three per cent and one per cent compared with last year.

Executive chairman Kevin Loosemore said in a conference call that the sector was “challenging” at the moment but that there was healthy interest in new products from Micro Focus.

Analysts welcomed the announcement as a commitment to providing investors with returns despite growth being flat, and predicted that the firm will continue with similar yields.

The payout will be funded by Micro Focus’s debt, which has fallen from $113.2m (£72m) to $90m since the end of April.