Yearly Dividend Payment Calculation (EASY)
Originally published: 10/05/2021 20:24
Publication number: ELQ-96007-1
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Yearly Dividend Payment Calculation (EASY)

Simple template to calculate your per annum dividend payments

Intended purpose:
This workbook provides a template and formulae for calculating dividends paid per annum.

Information regarding dividend payment:
Dividends are distributions of a company's profits to the company's shareholders.
Dividends are calculated by multiplying the assumed dividend rate (%) times the PBITDA in that year.
It is important that your financial models account for the possibility that you may not be profitable in a certain year and therefore, dividends will not be paid.
Namely, dividends will only be paid if the total dividend in the year is less than PBT (profit before tax) in the same year.
The formulae used in this workbook ensures that the above is true.

Where is this applicable in financial modelling?
Dividends paid should be taken away from total cash assets on a company's balance sheet.

Instructions for use:
1) All cells highlighted in yellow are input cells, you must insert your own numbers here
2) The time period is 20 years but you can simply delete columns or extend them using the Fill Right function in Excel
3) Once all yellow cells are complete, you will have successfully calculated your dividend paid per annum
4) Use this in your balance sheet to estimate total cash (minus dividends paid per annum from cash assets)

This Best Practice includes
1 Excel workbook

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Further information

To calculate a company's per annum dividend payment

- For companies which pay dividends to shareholders.


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