The British utility company is once again increasing its payout - with a dividend yield of 5.14%, the FTSE 100 company is well above the market average. But what is behind the dividend policy?
With a dividend yield of 5.14%, United Utilities is one of the top payers in the FTSE 100 - but the P/E ratio of just under 26 raises questions about the valuation.
344 million pounds for shareholders
Anyone holding United Utilities shares on July 18, 2025 has reason to be happy: the company is paying a dividend of GBP 0.52 per share for the 2025 financial year - four percent more than in the previous year.
A total of GBP 344.1 million will thus flow to shareholders. In an environment of rising capital market interest rates and growing uncertainty, such clear dividend promises send a clear signal.
The dividend yield at the reporting date was 5.14 percent - a remarkable figure compared to the FTSE 100 average of around 3.8 percent. For income-oriented investors, United Utilities thus remains one of the more reliable addresses among the British blue chips.
Reliable payer - with limited growth
The utility company from the north-west of England is not an exciting tech stock, but a rock-solid water and wastewater supplier - with a regulated business model, stable cash flows and a high degree of predictability.
This is exactly what institutional investors value. The business model may seem boring, but it is crisis-proof - and that pays off, literally.
For the past financial year 2025, United Utilities reported sales of GBP 2.145 billion and earnings per share of GBP 0.39.
This corresponds to a price/earnings ratio (P/E ratio) of around 26 - not exactly cheap, but explainable in view of the stable margins and reliable dividend policy. The company's management remains true to its policy: the top priority is a predictable payout, not short-term share price fantasy.
