Search button
Close search button
Logo Telefónica

Dividend policy

Telefónica establishes the shareholder remuneration policy taking into account the Group's earnings, cash generation, solvency, liquidity, flexibility to make strategic investments, and shareholders and investors expectations.

As a complement to dividend payments, the company uses the purchase and subsequent amortisation of its own shares as a form of shareholder remuneration, selectively depending on the rate of cash generation and the market price of the shares.

In 1998, Telefónica modified the shareholder remuneration policy, replacing the distribution of cash dividends with bonus issues. These operations were charged against unrestricted reserves, offering one free share for every 50 held.

These operations were carried out until the year 2003, when they were replaced by the distribution of cash dividends.

In July 2012, in an extremely challenging economic and financial environment, certain exogenous factors created severe instability. These unprecedented factors were beyond Telefónica’s control, and were crucial in order to make the Company take definitive steps to effectively defuse potential risks. Therefore, The Board of Directors decided that under the criteria of prudent administration and in the best interest of all Telefónica’s stakeholders that the dividend and share buyback program corresponding to 2012 be cancelled as a one-time exceptional measure.

In 2013, the Company brought back shareholder remuneration with a cash dividend of 0.75 euros per share, payable in two tranches. The first was paid on 6 November 2013 for the amount of 0.35 euros per share against unrestricted reserves, as approved at the General Shareholders' Meeting held in May 2013. The second tranche was paid on 7 May 2014, for the amount of 0.40 euros per share from 2014 net income.

The Board of Directors, at its meeting held on 26 February 2014, agreed, in relation to the 2014 dividend, to determine the amount thereof at 0.75 euros per share, payable in two tranches:

  • 0.35 euros per share, in the form of "scrip dividend", (a form of dividend through bonus issues whereby the shareholder may opt to receive the entirely or part of the amount corresponding to the dividend in cash or in new shares issued by the company). In November 2014 it was agreed to start the implementation of this "scrip dividend".
  • 0.40 euros per share in the second quarter of 2015, in cash.

Furthermore, in the publication of the results from the second half of 2014 on 25 February 2015, the company announced that it will propose the adoption of the appropriate corporate agreements for the distribution of a dividend of 0.75 euros per share in 2015 and 2016.

  • To amortise treasury shares in 2015 to the total of 1.5% of shares representative of the share capital and distribute a dividend of 0.75 euros per share. This dividend will be paid in two tranches:
    • in the fourth quarter of 2015, the amount of 0.35 euros per share in the form of "scrip dividend" and
    • in the second quarter of 2016, the amount of 0.40 euros per share in cash.
  • In 2016, amortise Treasury stock for a total of 1.5% share capital and distribute a dividend of 0.75 euros per share in cash, in both cases subject to the closing of the proposed sale of O2 UK.