Vector will increase dividends by at least 0.25cps annually provided the company has the financial capacity to do so.
Vector will ensure that after the payment of any dividend, the company:
Maintains a BBB credit rating from Standard & Poors, or an equivalent rating from another credit rating agency of similar standard;
Has the financial capacity to meet its medium-term investment and operating requirements; and
Complies with all funding covenants and the solvency test mentioned in the Companies Act.
Dividends are made only at the discretion of the board of Vector. The payment of dividends is not guaranteed and Vector’s dividend policy may change.
Dividend payments will:
Be split between interim and final dividends, in roughly equal measure; and
To the extent it is possible and prudent to do so, be fully imputed.
Vector’s electricity network is exposed to a regulatory reset on 1 April 2020. An adverse reset may impact Vector’s ability to deliver progressive dividends. It is therefore appropriate that we review this policy once the settings for the 2020 reset are finalised.
The dividend pay-out set out in this clause is not to be changed in any manner which results in a lower level of payments to the company's shareholders without the prior written agreement of Entrust, for such time as Entrust is a majority shareholder.