Hotels group is latest to slash dividend

MILLENNIUM & Copthorne yesterday became the latest company to cut its dividend.

The hotel operator more than halved its annual payout to shareholders – reducing it from 13.59p a share to 6.42p.

The move was yet another blow to investors who have seen dividends slashed at a number of firms in recent months.

It came as Millennium & Copthorne (down 13p to 377p) reported a 42pc drop in profits to £109m and warned that the outlook was ‘uncertain’.

Chairman Kwek Leng Beng said: ‘In 2015, global hospitality markets were impacted by falling commodity prices, mounting concern with regard to terrorism, health advisory travel alerts and uncertainty regarding growth of the Chinese market.’ Analysts warned of further dividend cuts in the coming weeks with some of the most generous payouts ( see table) expected to be slashed.

The yield on many stocks in the FTSE 100 index – how much it pays out relative to the share price – has shot up as the company has run into trouble and its shares have tanked.

Jason Hollands, director of broker Bestinvest, says: ‘Don’t be dazzled by the headline yield as there are plenty of potential landmines out there. A very high yield may indicate the market doesn’t believe the dividend is secure and is at risk of a cut – and that’s why the highest yielders are commodity stocks.’