Provident cheers victory in bid fight with dividend joy for shareholders

Doorstep lender Provident Financial paid its first half-year dividend since 2016 on Tuesday, signalling a return to some normality following a bruising hostile takeover bid.

The £23 million payout, higher than investors had expected, sent shares up nearly 8% to 447.30p. The company has been paying small full-year dividends but investors have missed out on a top-up at the interim stage.

That should help mend fences with top shareholders Neil Woodford and Invesco, who had backed a thwarted bid for Provvy from Non-Standard Finance.

“The board is feeling confident,” said chief executive Malcolm Le May.

“The 9p (dividend) reflects the confidence we’re on the right track but there’s still a lot to do. There is dramatic regulatory change which our business models are having to adapt to.”

Provident spent nearly £24 million on bid defence costs to see off Non-Standard, run by John Van Kuffeler.

The company ran into trouble in 2017 when a botched IT upgrade triggered a profit warning and share price crash.

Separately, Provident said finance chief Simon Thomas would step down due to previously announced personal health reasons.