Utility PPL Corp cuts dividend by almost 52% in 2022

PPL had previously hiked its dividend for 19 consecutive years

Utility PPL Corporation (symbol PPL) has announced a dividend cut of 51.8% o 20 cents per share in 2022. PPL shareholders had a warning last year when the dividend was not increased after 19 straight years with an increase in the annual dividend.

PPL has raised its dividend for 19 consecutive years through 2020, with dividend growth slowing down a lot in the last years. In 2020 PPL hiked by only 0.6 percent, following a 0.6 percent increase in 2019. In 2021 no dividend hike was announced followed by a big dividend cut this year.

In a press release PPL explains the lower dividend: "In addition, PPL announced a quarterly common stock dividend of $0.20 per share, payable April 1, 2022, to shareowners of record as of March 10, 2022. This will mark the company's 305th consecutive quarterly dividend paid since 1946. The dividend payment is based on projected earnings per share from PPL's existing business operations in Pennsylvania and Kentucky and the company's targeted payout ratio of 60%-65%. During its investor day, PPL plans to provide updated annualized dividend expectations and future dividend growth projections that are in line with earnings per share growth."

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A new annual dividend rate of $0.80 per share for PPL Corp yields 3.1% at a stock price of $26.10 for the utility company. Because of the dividend cut the annual dividend payment drops to $601 million. PPL stock has lost 13 percent year-to-date. 

PPL Corporation is utility holding company.  PPL Electric was founded in 1920 as Pennsylvania Power & Light Company. PPL, through its regulated utility subsidiaries, delivers electricity to customers in the U.K., Pennsylvania, Kentucky and Virginia; delivers natural gas to customers in Kentucky; and generates electricity from power plants in Kentucky. PPL Corporation, headquartered in Allentown, Pennsylvania, was incorporated in 1994 and has paid a dividend in every quarter since 1946 (source: dividendhike.com)