5th Oct 2012 10:45
INTERIM DIVIDEND FOR THE YEAR ENDING 31 DECEMBER 2012:
TIMETABLE, SCRIP CALCULATION PRICESAND EXCHANGE RATE
On 26 July 2012, the Directors announced an interim dividend for 2012 of 5.0 pence per ordinary share payable on 20 November 2012 (the "Dividend"). The Dividend will be paid totally as a Property Income Distribution ("PID") and will be subject to a 20% UK withholding tax unless exemptions apply.
As confirmed on 28 September 2012, following approval of the Scrip Dividend Scheme (the "Scheme") at the 2012 AGM, the Directors are offering shareholders a scrip alternative to the 2012 interim cash dividend.
The salient dates for payment of the dividend published in the announcement dated 28 September 2012 remain unchanged.
The Company is now pleased to announce the share price applicable to the scrip alternative to the cash dividend and, for its South African shareholders, the exchange rate applicable to the dividend. Due to differences applicable to UK and South African shareholders in respect of dividends, information is provided below as it relates to each share register.
Further details of the scrip dividend alternative are contained in the Scrip Dividend Scheme Booklet, and the related Election forms, which are available from www.capital-shopping-centres.co.uk and from the Company's Registrars.
(i) Shareholders on the UK share register:
Shareholders who hold their shares via the United Kingdom register will receive a dividend per ordinary share as follows:
Gross amount of PID GBP pence 5.0p *Less 20% withholding tax GBP pence 1.0p Net PID dividend payable GBP pence 4.0p
*Unless exemptions apply, in which case the PID element will be paid gross
As indicated in the announcement dated 28 September 2012, the price setting period for the Scrip price calculation was 28 September to 4 October 2012 inclusive. Based on the average middle market quotations for each day in the price setting period on the LSE less the gross amount of dividend as set out above, the Scrip Calculation Price applicable to UK share holders is GBP pence 328.48. The scrip share allocation will be based as follows:
PID (Net) PID (Gross)
No. of shares required to be held for one 82.120 65.696 new share
The number of shares to be allocated will be calculated by dividing the total value of the dividend otherwise receivable by the shareholder by the Scrip Calculation Price and rounding down to the nearest whole number. Any fractional entitlement, i.e. the total value of the dividend receivable less the value of the shares allocated, will be paid out as cash.
(ii) Shareholders on the South Africa share register:
Exchange Rate for Interim Dividend
The Company confirms that the South African Rand exchange rate for the 2012 interim dividend of 5 pence per ordinary share will be 13.77 ZAR to 1 GBP. Accordingly shareholders who hold their shares via the South African register will receive a dividend per ordinary share as follows:
PID (gross) 68.85000 ZA cents Less 20% UK withholding tax 13.77000 ZA cents Net PID payable 55.08000 ZA cents
On application by South African shareholders, 5 per cent of the 20 per cent UK withholding tax deducted is claimable from the UK's HM Revenue & Customs ("HMRC"), resulting in an effective UK withholding tax rate of 15 per cent. The Company will account to HMRC in sterling for the total UK withholding tax deducted. Settlement of any claims for refund will be calculated and settled in sterling by HMRC.
The information given in section (i) above will assist with applications for refunds. For information on PIDs and refund claims, including claim forms and guidance on how to complete them, visit http:// www.capital-shopping-centres.co.uk/ investors/shareholder_info/reit/.
Scrip Calculation Price
As indicated in the announcement dated 28 September 2012, the price setting period for the Scrip price calculation was 28 September to 4 October 2012 inclusive. Based on the average middle market quotations for each day in the price setting period on the JSE less the gross amount of dividend as set out above, the Scrip Calculation Price applicable to South African shareholders is 4,443.83 ZA cents.
The scrip ratio will be as follows:
South Africa: 1 new ordinary share for every 80.67948 ordinary shares held.
By way of illustration of the above, the scrip share allocation will be as follows:
A shareholder who holds 100 shares, entitled to receive ZAR 55.08000, and elects to receive a scrip dividend alternative would be entitled to 100 / 80.67956 = 1.23947 shares.
As no fractions of shares will be issued, the number shares to be allocated will be rounded down to the nearest whole number. Any fractional entitlement, calculated by multiplying the fraction, for example as shown above of 0.23947 by the scrip price of 4,443.83 ZA cents, will be paid out as cash.
No secondary tax on companies (STC) credits will be available to be utilised against Dividend Tax withheld on the payment of the Interim Dividend. The number of shares in issue as at the declaration date was 865,204,771 ordinary shares of 50p each.
Taxation summary
Where the 2012 interim dividend is paid in cash, it will constitute a foreign dividend and so will be exempt from South African income tax. Cash PIDs would normally be subject to Dividends Tax in South Africa, but the liability to Dividends Tax will be offset by the net UK withholding tax of 15 per cent, resulting in no Dividends Tax being deducted. It is our understanding that where an election to receive shares under the Scrip Dividend Scheme has been made, any fractional entitlements paid in cash to shareholders will be treated in the same manner.
It is also understood that a receipt of shares under the Scrip Dividend Scheme will constitute a foreign dividend. Under current legislation, such shares will not be subject to Dividends Tax but will instead be subject to income tax at a rate of 15 per cent. However this income tax liability will be offset by the net UK withholding tax of 15 per cent and so no further income tax liability is anticipated.
New shares issued to South African shareholders under the Scrip Dividend Scheme will, subject to approval of draft legislation, have a capital gains base cost equal to the amount of the foreign dividend. This may be deducted from the proceeds on a future sale of the shares, meaning in practice only any future gain on the shares should be subject to capital gains tax in South Africa.
The above information, and the guidelines on the taxation of dividends, including when taken as scrip shares, contained in the Scheme Booklet, is provided as a general guide based on the Company's understanding of the law and practice currently in force. Any Shareholder who is in any doubt as to their tax position should seek independent professional advice.
5 October 2012
XLONRelated Shares:
INTU.L